合肥美菱股份有限公司
Hefei Meiling Co.,Ltd.
二〇一二年半年度报告
Semi-Annual Report 2012
0
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Contents
Chapter I. Important Notice ……………………………………………………2
Chapter II. Company Profile……………………………………………………3
Chapter III. Major accounting data and business abstract……………………...5
Chapter IV. Changes in Share Capital and Particular about Shareholders……..9
Chapter V. Directors, Supervisors and Senior Executives…………………….18
Chapter VI. Report of the Board of Directors………………………………….23
Chapter VII. Significant Events………………………………………………..50
Chapter VIII. Financial Report（Unaudited）…………………….………….82
Chapter IX. Documents Available for Reference……………..………………205
1
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter I. Important Notice
1. Board of Directors, Supervisory Committee, all directors, supervisors and senior executives
of Hefei Meiling Co., Ltd. (hereinafter referred to as the Company) hereby confirm that there are no
any fictitious statements, misleading statements, or important omissions carried in this report, and
shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of the
whole contents.
2. The Company did not have that directors, supervisors and senior executives of the Company
could not guarantee the reality, accuracy and completion of the whole contents or have objections.
3. All the directors attended the board meeting on discussing the Semi-Annual Report in both
ways of site and communication.
4. The company semi-annual financial report 2012 has not been audited.
5. Chairman of the Company Mr. Liu Tibin, President Mr. Wang Yong, deputy president Mr.
Yu Wanchun and Person in Charge of Accounting Organ Mr. Tang Bin hereby confirm that the
Financial Report of the Annual Report is true and complete.
Paraphrase：
Items Refers to Definition
Company, the Company or
Refers to HEFEI MEILING CO., LTD
Meiling Electric
Sichuan Changhong Refers to Sichuan Changhong Electric Co., LTD
Changhong Group Refers to Sichuan Changhong Electronics Group Co., Ltd.
Hong Kong Changhong Refers to Changhong (Hong Kong) Trading Company Limited
Meiling Group Refers to Hefei Meiling Group Holdings Limited
Xingtai Holding Refers to Hefei Xingtai Holding Group Co., Ltd.
Jiangxi Meiling Refrigeration Refers to Jiangxi Meiling Refrigeration Company Limited
Jiangxi Meiling Electric Refers to Jiangxi Meiling Electrical Co., Ltd.
Huayi Compressor Refers to Huayi Compressor Co., Ltd.
CSRC Refers to China Securities Regulatory Commission
China Securities Regulatory Commission, Anhui
Anhui Securities Bureau Refers to
Province Securities Regulatory Bureau
SSE Refers to Shenzhen Stock Exchange
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter II. Company Profile
I. Company information
Code for A-share 000521 Code for B-share 200521
Short form for
Short form for A-share MEILINGDIANQI WANMEILING-B
B-share
Listing stock exchange Shenzhen Stock Exchange
Legal Chinese name of
合肥美菱股份有限公司
the Company
Abbr. of legal Chinese
美菱电器
name of the Company
Legal English name of
HEFEI MEILING CO.,LTD.
the Company
Abbr. of legal English
HFML
name of the Company
Legal Representative Liu Tibin
No. 2163, Lian Hua Road, Economic and Technology Development
Registered Add.
Zone, Hefei
Post Code of registered
230601
add.
No. 2163, Lian Hua Road, Economic and Technology Development
Office Add.
Zone, Hefei
Post Code of office add. 230601
Internet website http://www.meiling.com
E-mail info@meiling.com
II. Contact person and ways
Secretary of the Board
Name Li Xia
No. 2163, Lian Hua Road, Economic and Technology
Contact adds.
Development Zone, Hefei
Tel. 0551-2219021
Fax. 0551-2219021
E-mail lixia@meiling.com
III. Information disclosure and place for preparation
Newspapers Designated for Securities Times, China Securities Journal and Hong Kong
information disclosure Commercial Daily
Website designated by CSRC for
http://www.cninfo.com.cn
publishing semi-annual report
place for preparation of Secretariat of the Board of Directors, on 2/F of the Company’s
semi-annual report Office Bldg.
3
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
IV. Other relevant information of the company
1. Initial registration date: 31 December 1992
Registration address: Hefei Municipal Administration Bureau of Industrial and Commerce
The latest registration date: 23 February 2012
Registration address: Anhui Provincial Administration for Industry and Commerce
2. Legal Person Business License Registration No: 340000400001278
3. Legal Representative: Liu Tibin
4. Register capital: RMB 636,449,338
5. Code of taxation registration: GSWZi No.: 34011114918555X
WDHZi No.: 34011114918555X
6. Organization Code Certificate: 14918555-X
7. The name of CPAs engaged by the Company: Shine Wing Certified Public Accountants Co.,
Ltd.
Office address: 9/F, Block A, Fu Hua Mansion No.8 Chao Yang Men Bei da jie, Dong Cheng
District, Beijing, P.R.C
8. Sponsor engaged by the Company for implementation of supervisory accountability
continuously
Name: CHINA MERCHANTS SECURITIES CO., LTD.
Office add.: 38-45/F, Block A, Jiangsu Building, Yitian Rd., Futian District, Shenzhen
Signature representative of sponsor: WU HONG XING, XU ZHONG ZHE
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter III. Major accounting data and business abstract
I. Major accounting data and financial indexes
Whether retroactive adjusted on previous financial report or not
□Yes √ No
(I) Major accounting data
Increase/decrease in
Reporting period Same period of last
Major accounting data this report period
(Jan. to June) year
year-on-year (%)
Total business revenue(RMB) 5,312,610,523.12 5,475,018,688.64 -2.97%
Business profit(RMB) 126,419,575.43 22,064,506.86 472.95%
Total profit(RMB) 125,373,406.07 139,463,828.43 -10.10%
Net profit attributable to
shareholders of the listed 110,855,042.20 126,157,996.21 -12.13%
company (RMB)
Net profit attributable to
shareholders of the listed
company after deducting 111,636,785.91 115,854,863.04 -3.64%
non-recurring gains and
losses(RMB)
Net cash flow arising from
-260,544,290.53 -544,333,695.81 52.14%
operating activities(RMB)
Increase/decrease in
this period-end over
End of this period End of last period
that of last
period-end (%)
Total assets(RMB) 8,395,162,020.63 7,602,563,620.91 10.43%
Owners’ equity attributable to
shareholders of the listed 2,906,754,333.79 2,796,317,375.44 3.95%
company(RMB)
Share capital(Share) 636,449,338.00 636,449,338.00 -
(II) Major financial indexes
Increase/decrease in
Reporting period Same period of last
Major financial indexes this report period
(Jan. to June) year
year-on-year (%)
Basic earnings per share
0.1742 0.2379 -26.78%
(RMB/Share)
Diluted earnings per share
0.1742 0.2379 -26.78%
(RMB/Share)
Basic EPS after deducting
non-recurring gains/losses 0.1754 0.2184 -19.69%
(RMB/Share)
Fully diluted ROE (%) 3.81% 4.44% -0.63%
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Weighted average ROE (%) 3.89% 4.54% -0.65%
Fully diluted ROE after
deducting non-recurring 3.84% 4.07% -0.23%
gains/losses (%)
Weighted average ROE after
deducting non-recurring 3.91% 4.17% -0.26%
gains/losses (%)
Net cash flow per share arising
from operating activities -0.41 -1.03 60.19%
(RMB/Share)
Increase/decrease in
this period-end over
End of this period End of last period
same period of last
period-end (%)
Net assets per share attributable
to shareholder of listed company 4.57 4.39 4.10%
(RMB/ Share)
Asset-liability ratio (%) 64.68% 62.46% 2.22%
Explanation on previous major accounting data and financial indexes at period-end：
The Company has implemented the 2010 profit distribution in August 2011, after the
completion of company's total share capital increase from 530,374,449 shares to 636,449,338 shares.
The denominator of earnings per share, net assets per share and other indicators on the table in the
same period last year is the total stock of 530,374,449 shares prior to the implementation of the
distribution of profits in 2010, during the report period the denominator of these indicators is the
total share capital of 636,449,338 shares after the implementation of the distribution of profits in
2010.
II. Difference of accounting data under CAS and IAS
(I) Difference of net profit and net assets disclosed in financial report based on IAS and
CAS
□ Applicable √ Not applicable
(II) Difference of net profit and net assets disclosed in financial report based on foreign
accounting standards and CAS
√ Applicable □ Not applicable
Unit: RMB
Net profit attributable to shareholders Owners’ equity attributable to
of listed company shareholders of listed company
This period Last period At period-end At period-begin
CAS 110,855,042.20 126,157,996.21 2,906,754,333.79 2,796,317,375.44
Sub-items and total adjusted based on IAS: 0
IAS 110,855,042.20 126,157,996.21 2,906,754,333.79 2,796,317,375.44
Explanations on
differences between - - - -
CAS and IAS rules
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(III) Detail items for major differences
Nil
(IV) Explanation on accounting data difference under the foreign/domestic accounting
standards
On 12 September 2007, the CSRC issued the Notice For Related Problems On Auditing Of
Companies Issuing Domestically Listed Foreign Shares, announced to cancel the Double Audit
requirement for companies which issue domestically listed foreign shares (B-share Companies)
taking overseas audit when taking audit in engaged securities eligible for Certified Public
Accountants demonstrated in previously reported in related information disclosure norms. All the
financial reports were compiled without overseas accounting rules since 2007 and all the financial
reports of the Company were compiled according to Corporation Accounting Rules. So there is no
difference between domestic and overseas accounting rules.
III. Item and amount with non-recurring gains/losses deducted
√Applicable □Not applicable
Items Amount (RMB) Note
Gains and losses from disposal of See the notes to financial
-5,181,933.89
non-current assets statement "non-operating income"
Governmental subsidy calculated into current
gains and losses(while closely related with
the normal business of the Company, See the notes to financial
4,237,836.91
excluding the fixed-amount or statement "non-operating income"
fixed-proportion governmental subsidy
according to the unified national standard)
Other non-operating income and expenditure See the notes to financial
-102,072.38
except the abovementioned statement "non-operating income"
Other item that satisfied the definition of
non-recurring gains and losses
Influenced amount of minority shareholders’
302,656.89
equity
Impact on income tax -38,231.24
Total -781,743.71 --
IV. The Company’s return on equity and earnings per share in the first half of 2012
calculated in accordant with Requirements on the Information Disclosure of Companies
Publicly Issuing Shares No. 9----Calculation and Disclosure on Return on Equity and
Earnings per Share, as follows:
Unit: RMB
Earnings per share(RMB)
Weighted average Return
Profit during the reporting period
on equity (%) Basic ESP Diluted ESP
Net profit attributable to common
3.89% 0.1742 0.1742
shareholders of the Company
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Net profit attributable to common
shareholders of the Company after
3.91% 0.1754 0.1754
deducting the non-recurring losses
and gains
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter IV. Changes in Share Capital and Particular about Shareholders
I. Changes in share capital (ended of 30 June 2012)
(I) Statement of changes in shares
√Applicable □Not applicable
Unit: Share
Before the Changes Increase/Decrease in the Change（+，-） After the Changes
B
Newly on Public
- us reserve-c Proportio
Amount Proportion Others Subtotal Amount
issued sh onverted n
shares ar shares
es
I. Restricted shares 149,383,274 23.47% -93,993,046 -93,993,046 55,390,228 8.70%
1. State-owned
102,464 0.02% -102,464 -102,464 0 0.00%
shares
2. State-owned legal
80,953,606 12.72% -33,490,596 -33,490,596 47,463,010 7.46%
person’s shares
3. Other domestic
68,327,204 10.73% -60,399,986 -60,399,986 7,927,218 1.24%
shares
Including:
Domestic
68,224,740 10.72% -60,503,474 -60,503,474 7,721,266 1.21%
Non-state-owned
legal person’s shares
Domestic natural
102,464 0.01% +103,488 +103,488 205,952 0.03%
person’s shares
4. Foreign shares
Including: Foreign
legal person’s shares
Foreign natural
person’s shares
5. Senior executives’
0 0.00% 0 0 0 0.00%
shares
II. Unrestricted
487,066,064 76.53% +93,993,046 +93,993,046 581,059,110 91.30%
shares
1. RMB Ordinary
351,346,064 55.20% +93,993,046 +93,993,046 445,339,110 69.97%
shares
2.Domestically
135,720,000 21.33% 0 0 135,720,000 21.33%
listed foreign shares
3. Overseas listed
foreign shares
4. Others
III. Total shares 636,449,338 100.00% 636,449,338 100.00%
1. Approval of changes in shares (if applicable)
Inapplicable
2. Ownership transfer of changed restricted shares
In reporting period, in restricted shares of the Company, 103,488 shares held by former
Changfeng County Qingjian Electrical Parts Plant were transferred to Xiong Xueqin.
3. Influence on latest EPS, net assets per share and other financial index from changes in
shares (if applicable)
Inapplicable
4. Other information necessary to be disclosed by the Company or should be disclosed
according to requirement of securities regulators
On 11 January 2012, part of the restricted shares of privately A-share offering in 2010 was
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
un-lock, totally 7 shareholders (excluding shares purchased by controlling shareholder - Sichuan
Changhong Electronic Co., Ltd.) were un-lock in this time. Un-lock shares amounting to
93,385,200 shares, a 14.67% in total share capital of the Company.
The 5th restricted circulating shares after implementation of share-split reform was un-lock for
trading dated 30 March 2012. Totally 5 shareholders are have shares released, un-lock shares
amounting to 607,846 shares, a 0.0955% in total share capital of the Company.
(II) Changes in restricted shares
√ Applicable □Not applicable
Unit: Share
Restricted
Restricted
shares at Restricted Restricted
shares
the shares shares at Reason for
Name of shareholders increased Date of releasing
beginning released the end of restriction
this
of the this period period
period
period
China life insurance asset
management Co., Subscribe 2010
LTD.-zhengde life insurance non-public
24,000,000 24,000,000 0 0 2012-1-11
Co., LTD-universal offering of
insurance products shares
Subscribe 2010
Fullgoal Fund Management non-public
24,000,000 24,000,000 0 0 2012-1-11
Co., Ltd.(Note 1) offering of
shares
Subscribe 2010
Guotai Junan Securities Co., non-public
12,000,000 12,000,000 0 0 2012-1-11
Ltd. offering of
shares
Subscribe 2010
FOUNDER SECURITIES non-public
10,800,000 10,800,000 0 0 2012-1-11
CO., LTD. offering of
shares
Subscribe 2010
Ningbo Wei Chuang Joint non-public
10,800,000 10,800,000 0 0 2012-1-11
Investment Co., Ltd. offering of
shares
Subscribe 2010
non-public
Donghai Securities Co. Ltd. 10,800,000 10,800,000 0 0 2012-1-11
offering of
shares
Subscribe 2010
Guotai Fund Management non-public
985,200 985,200 0 0 2012-1-11
Co., Ltd(note2) offering of
shares
Anhui BaiHu electronic 86,835 86,835 Share reform
0 0 2012-3-30
equipment factory commitments
86,835 86,835 Share reform
Hefei Carton Factory 0 0 2012-3-30
commitments
Nanjing Lide Plastic Co., 86,835 86,835 Share reform
0 0 2012-3-30
LTD commitments
Liaoning Huaxing 260,506 260,506 Share reform
0 0 2012-3-30
Machinery Co., Ltd. commitments
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Hefei State-Owned Assets 86,835 86,835 Share reform
0 0 2012-3-30
Holding Co., LTD commitments
Total 93,993,046 93,993,046 0 0 - -
Note 1: Fullgoal Fund Management Co., Ltd. hold 24,000,000 shares of the Company in total
through its nine kinds of fund products, accounting 3.77% of the total share capital of the Company;
the restricted shares of the Company held by its subordinate fund products 24,000,000 shares have
been released for listing dated 11 January 2012.
Note 2: Guotai Fund Management Co., Ltd. holds 985,200 shares of the Company through its
fund products, "National Social Security Fund 111 combination, representing 0.15% of the total
share capital of the Company; the restricted shares of the Company held by its subordinate fund
products 985,200 shares have been released for listing dated 11 January 2012.
II. Security offering and listing
(I) Security offering in previous three years
√Applicable □Not applicable
Stocks and Numbers for
Offering Offering price The issuing Dead deal
their derivative Listing date listing
date RMB/Share) numbers date
securities authorized
Stock
2010
non-public
2010-12-29 10.28 116,731,500 2011-1-10 116,731,500 -
offering of A
shares
Convertible corporate bonds, separable-traded convertible bond and Corporate bonds
N/A
Warrants
N/A
Explanation of securities offering in previous three years (explaining those bond owes different
rate in duration respectively)
As deliberated and approved by the second extraordinary shareholders’ general meeting and
the 32nd Meeting of the 6th session of the Board, and approved by CSRC [Zheng Jian Xu Ke (2010)
No. 1715], the Company issued 116.7315 million A shares to specified 8 investors including
Sichuang Changhong in a non-public offering way with issued price of 10.28 Yuan/Share.
According to the Capital Verification (No.: XYZH2010CDA6021) issued by Shine Wing Certified
Public Accounts, total proceeds raised in this offering are RMB1,199,999,820.00 and the net
proceeds amount to RMB1,177,954,320.00 after deducted offering expenses RMB 22.0455 million
(including underwriting and sponsoring fee RMB 20.5 million). On 29 December 2010, the
Company has accomplished registration and custody procedures as well as shares restriction sales
of this issuing of new shares in China Securities Depository and Clearing Co., Ltd. Shenzhen
Branch. On10 January 2011, the 116.7315 million newly non-publicly issued A shares were
officially listed in Shenzhen Stock Exchange.
(II) Changes of total shares and structures as well as outcome of asset-liability structures
□Applicable √Not applicable
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(III) Current shares held by internal staffs
□Applicable √Not applicable
III. Shareholders and actual controller
(I) Total shareholders at period-end
Till end of reporting period, total shareholders of the Company amounting to 67,178.
(II) Particulars about the top ten shareholders and the top 10 shareholders of unlimited
sale conditions
1. Shares held by top ten shareholders
Particulars about the shares held by the top ten shareholders
Proportion of Amount of Shares pledged or frozen
Nature of Total amount
Shareholders (full name) shares held the restricted
shareholders of shares held Share status Amount
(%) shares held
Sichuan Changhong State-owned
21.58% 137,356,942 46,692,600
electric Co., LTD corporate
Hefei Xingtai Holding State-owned
6.26% 39,852,835 601,164
Group Co., Ltd. corporate
Zhengde life insurance Funds,
Co., LTD-universal financial 3.77% 24,000,000
insurance products products, etc.
Changhong Electric
foreign legal
(Hong Kong) Trading 3.30% 20,971,519
person
Co., Ltd.
GUOTAI JUNAN
foreign legal
SECURITIES(HONGKO 2.16% 13,716,869
person
NG) LIMITED
Domestic
Ningbo Wei Chuang Joint
general legal 1.70% 10,800,000 Pledge 10,800,000
Investment Co., Ltd.
person
FOUNDER State-owned
1.70% 10,800,000
SECURITIES CO., LTD. legal person
Donghai Securities Co. State-owned
1.70% 10,800,000
Ltd. legal person
Foreign
CAO SHENGCHUN natural 1.64% 10,447,206
person
Foreign
Long Qinfang natural 0.40% 2,574,757
person
Explanation of shareholders N/A
2. Particulars about the shares held by the top ten unrestricted shareholders
Amount of shares Type/amount of shares
Shareholders
held at period-end Type Amount
Sichuan Changhong electric Co., LTD 90,664,342 A-share 90,664,342
Hefei Xingtai Holding Group Co., Ltd. 39,251,671 A-share 39,251,671
Zhengde life insurance Co.,
24,000,000 A-share 24,000,000
LTD-universal insurance products
Changhong Electric (Hong Kong)
20,971,519 B-share 20,971,519
Trading Co., Ltd.
GUOTAI JUNAN
13,716,869 B-share 13,716,869
SECURITIES(HONGKONG) LIMITED
Ningbo Wei Chuang Joint Investment 10,800,000 A-share 10,800,000
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Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Co., Ltd.
FOUNDER SECURITIES CO., LTD. 10,800,000 A-share 10,800,000
Donghai Securities Co. Ltd. 10,800,000 A-share 10,800,000
CAO SHENGCHUN 10,447,206 B-share 10,447,206
Long Qinfang 2,574,757 B-share 2,574,757
Explanation on associated relationship or accordant action among the aforesaid shareholders:
Among the above shareholders, Changhong (Hong Kong) Trade Co., Ltd. is the
wholly-owned subsidiary of Sichuan Changhong Electronic Co., Ltd.; there existed no associated
relationship or belong to the concerted actors as specified in the Measures for the Administration
of Information Disclosure of Shareholder Equity Changes of Listed Companies among Sichuan
Changhong Electronic Co., Ltd., Changhong (Hong Kong) Trade Co., Ltd. and other top 8
shareholders; and top ten shareholders with unrestricted subscription; as the Company has not
known whether there exists any business relationship among the other shareholders with
unrestricted subscription or they belong to the concerted actors as specified in the Measures for
the Administration of Information Disclosure of Shareholder Equity Changes of Listed
Companies.
3. Particulars about shares amount held by the top ten restricted shareholders and the
restricted condition in report period
Unit: Share
Name of shareholders Restricted shares held Restricted condition
Subscription issued shares
Sichuan Changhong Electronic non-publicly in 2010, still in
46,692,600
Co., Ltd restricted period within report
period.
Share reform commitments; not
Provincial Agricultural Bank of return the compensation payment;
1,844,370
China, Hefei Office Trust the shares held have been not in
circulation yet
Share reform commitments; not
Hefei Science & Technology return the compensation payment;
1,024,650
Bank the shares held have been not in
circulation yet
Share reform commitments; not
return the compensation payment;
City Insurance Company 1,024,650
the shares held have been not in
circulation yet
Advanced on the price of the shares
of the share reform received from
Hefei Xingtai Holding Group the other shareholders during the
601,164
Co., Ltd. report period ，such shares are
selling restriction shares，and not
yet handle lift restrictions on sale.
Share reform commitments; not
return the compensation payment;
Hefei Branch of Bank of China 512,325
the shares held have been not in
circulation yet
13
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Share reform commitments; not
Hefei Union Industrial return the compensation payment;
512,324
Enterprise the shares held have been not in
circulation yet
Share reform commitments; not
Provincial Agricultural Bank of return the compensation payment;
409,860
China, Wuhu Office Trust the shares held have been not in
circulation yet
Share reform commitments; not
return the compensation payment;
Long tang Ice Factory 204,930
the shares held have been not in
circulation yet
Share reform commitments; not
return the compensation payment;
Hefei Plastic Plant 204,930
the shares held have been not in
circulation yet
Share reform commitments; not
return the compensation payment;
Hefei Chengdong Ice Factory 204,930
the shares held have been not in
circulation yet
Share reform commitments; not
return the compensation payment;
Trust and Investment Company 204,930
the shares held have been not in
circulation yet
Share reform commitments; not
Wanbao Group Cooler return the compensation payment;
204,930
Production Industry Company the shares held have been not in
circulation yet
(III) Controlling shareholder and actual controller
1. Changes of controlling shareholders and actual controller
□Applicable √Not applicable
On 18 May 2006 and 11 January 2007, Meiling Group Holdings respectively signed Share
Transfer Agreement of Meiling Electronic Appliance and Share Transfer Supplementary Agreement
of Meiling Electronic Appliance with Sichuan Changhong and Changhong Group ; Meiling
Group planed to transfer its holding 82,852,683 shares among 123,396,375 shares to Sichuan
Changhong and Changhong Group in the method of agreement transfer, of which Sichuan
Changhong accepted 45,000,000 shares(accounting for 10.88 percent in total shares of the
Company) with becoming the first largest shareholder and Changhong Group accepted 37,852,683
shares(accounting for 9.15 percent in total shares of the Company) with becoming the third largest
shareholder. In August 2007, the aforementioned shares transfer accomplished its ownership
transfer. On Dec. 26, 2008, the Company received the Document on Reply of Shares Transfer Held
by State-owned Shareholders of Hefei Meiling Co., Ltd.(GZCQuan〔2008〕No.1413) delivered from
Changhong Group issued by State-owned Assets Supervision and Administration Commission of
the State Council, in which 32,078,846 shares of the Company held by Changhong Group were
approved to be transferred to Sichuan Changhong. On 21 January 2009, the aforementioned shares
14
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
transfer accomplished its ownership transfer. After the transfer, 70,214,797 tradable shares with
restricted conditions held by the first largest shareholder Sichuan Changhong of the Company
accounted for 16.98 percent in the total shares of the Company. Sichuan Changhong committed to
continue to perform the commitment made by Changhong Group during the share merger reform of
the Company.
In 2010, Sichuan Changhong participated in the privately A share offering 2010 of the
Company. Finally, A share of the Company amounting to 38,910,500 shares were subscribed by
Sichuan Changhong with price of RMB10.28 per share. The profit distribution plan 2010 of the
Company was implemented on 4 August 2011. Take total share capital 530,374,449 shares as base
dated 31 December 2010, distributed cash bonus RMB 0.5(tax included) with 2 shares more to
every 10 shares held by all shareholders. Being completed, shares of the Company held by
Sichuan Changhong increase to 136,082,942 shares. As at the end of 31 December 2011, shares of
the Company total as 156,839,461 shares, a 24.64% of total share capital, were jointly held by
Sichuan Changhong and its persons acting in concert Hong Kong Changhong. Among these share
holding, A share of the Company 136,082,942 shares, 21.38% of the share capital, were held by
Sichuan Changhong directly while circulated B share of the Company 20,756,519 shares, 3.26% of
the total share capital, were held by Hong Kong Changhong. First largest shareholder of the
Company is Sichuan Changhong.
On 16 January 2012, letter about increasing shares holding of the Company was received by
the Company from its controlling shareholder Sichuan Changhong. With the confidence of future
development in respect ion, during 26 December 2011 to 13 January 2012, Sichuan Changhong and
its subordinated wholly-owned subsidiary Hong Kong Changhong increase their shareholdings of
the Company, totally to 1,664,541 shares together, a 0.26% of total share capital, via trading system
of Shenzhen Stock Exchange. Among the shareholdings, Sichuan Changhong totally holding more
1,274,000 circulated A shares of the Company, a 0.20% of total share capital, on 13 January 2012
through trading system of Shenzhen Stock Exchange; during period of 26 December 2011 to 13
January 2012, Hong Kong Changhong holding more 390,541 circulated B shares of the Company, a
0.06% of the total share capital, through trading system of Shenzhen Stock Exchange.
As at the end of 13 January 2012, shares of the Company total as 158,328,461 shares, a
24.88% of total share capital, were jointly held by Sichuan Changhong and its persons acting in
concert Hong Kong Changhong. Among these share holding, A share of the Company 137,356,942
shares, 21.58% of the share capital, were held by Sichuan Changhong directly while circulated B
share of the Company 20,971,519 shares, 3.30% of the total share capital, were held by Hong Kong
Changhong--person acting in concert of Sichuan Changhong.
2. Introduction of controlling shareholders and actual controller
Whether has new actual controller or not
□Applicable √Not applicable
State-owned Assets Supervision & Administration
Name of actual controller
Commission of Mianyang Municipality
15
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Local State-Owned Assets Supervision & Administration
Type of actual controller
Committee
Statement: According to Reply of Shares Transfer Held by State-owned Shareholders of Hefei
Meiling Co., Ltd issued by State-owned Assets Supervision and Administration Commission of the
State Council and the Registration and Transfer Confirmation and Name List of Shareholders issued
by Shenzhen Branch of China Securities Depository and Clearing Corporation Limited, Sichuan
Changhong Electronic Co., Ltd is the controlling shareholder of the Company.
Sichuan Changhong Electronic Co., Ltd.: Legal representative: Mr. Zhao Yong; registered
capital: RMB 4,616,244,222; establishment dated 8 April 1993; code of organization: 20541230-8;
registered address: No. 35, Mianxing (E) Road, Hi-tech Zone, Mianyang, Sichuan; business scope:
manufactures, sales and maintenance of household appliance, Electronic products and spare parts,
communications equipments, computer and other Electronic equipments, specialized equipments of
Electronic and Electronic, Electronic machinery and equipment, series products of batteries,
Electronic medicine products, Electronic equipments, digital monitoring products, metal products,
apparatus and instruments, culture and office machines, culture and education and sports products,
furniture, kitchen cabinet and gas appliance; house and equipment rental, packing products and
technical services; road transportation, storage and discharging convey; e-commerce; R&D, sales
and services of software; consultancy and services of enterprise management; hi-tech project
investment and other state-permitted business; development and operation of property; callback and
disposal of obsolete appliance and Electronic products.
Sichuan Changhong Electronic Group Co., Ltd. is the controlling shareholder of Sichuan
Changhong Electronic Co., Ltd.: Legal representative: Mr. Zhao Yong; registered capital: RMB
898,040,000; establishment dated 16 June 1995; code of organization: 72081866-0; registered
address: No. 35, Mianxing (E) Road, Hi-tech Zone, Mianyang, Sichuan; business scope:
manufacturing and sales of household appliance, automobile Electronic appliance, Electronic
products and components, products of Electronic information network, Electronic commerce, new
materials, Electronic products, environmental products, equipment for communication transmission,
and Electronic material; and property development. Ended as Dec. 31, 2011, Sichuan Changhong
Electronic Group Co., Ltd. held 1,070,723,925 shares of Sichuan Changhong Electronic Co., Ltd.
with accounting for 23.19 percent of the total share capital of Sichuan Changhong Electronic Co.,
Ltd.
The actual controller of Sichuan Changhong Electronic Group Co., Ltd. is State-owned Assets
Supervision & Administration Commission of Mianyang Municipality. State-owned Assets
Supervision & Administration Commission of Mianyang Municipality held 100 percent equities of
Sichuan Changhong Electronic Group Co., Ltd. State-owned Assets Supervision & Administration
Commission of Mianyang Municipality is entrusted by the same level government, together
performs decision-making and management of state-owned asset owners, and is one organization
which executes comprehensive management and supervision on its belonged state-owned assets.
16
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
3. Property rights and the block diagram of the control relationship between the company and
the actual control
Equity structure chart of the Company ended as 30 June 2012 is as follows:
State-owned Assets Supervision &
Administration Commission of Mianyang
100%
Sichuan Changhong Electric Group Co., Ltd.
23.19%
Sichuan Changhong Electric Co., Ltd.
100%
21.58%
Changhong (Hong Kong) Trade Co., Ltd.
3.30%
Hefei Meiling Co., Ltd.
4. Actual controller controlling the Company by means of entrust or other assets management
□Applicable √Not applicable
(IV) Other legal person’s shareholders with over ten percent shares held
□Applicable √Not applicable
IV. Convertible bonds
□Applicable √Not applicable
17
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter IV Directors, Supervisors and Senior Executives
I. Changes of shares held by directors, supervisors and senior executive
During the report period, Company directors, supervisors and senior management does not hold the company stock.
Whether
Amount received
Amount of Amount of
Shares of remunerati
shares Shares held Including: stock
held at shares Reasons on from
Office dated decreased at restricted option held
Name Title Sex Age Office dated from period- increase for shareholder
ended in this period-end shares held at
begin( in this changes s’ unit or
period (Share) (Share) period-end
Share) period(S other
(Share) (Share)
hare) related unit
or not
Liu Tibin Director M 49 2011-11-15 2014-6-20 0 0 0 0 Yes
Deputy
Li Jin M 45 2011-6-20 2014-6-20 0 0 0 0 Yes
chairman
Director,
Wang Yong President M 45 2011-6-20 2014-6-20 0 0 0 0 NO
Director,
Li Wei deputy M 39 2011-6-20 2014-6-20 0 0 0 0 NO
president
Sun
Director M 51 2011-6-20 2014-6-20 0 0 0 0 Yes
Liqiang
Wang Independen
M 68 2011-6-20 2014-6-20 0 0 0 0 NO
Xingzhong t director
Song Independen
M 72 2011-6-20 2014-6-20 0 0 0 0 NO
Baozeng t director
Liu Independen
M 57 2011-6-20 2014-6-20 0 0 0 0 NO
Youpeng t director
Zhang Independen
M 62 2011-6-20 2014-6-20 0 0 0 0 NO
Shidi t director
18
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chairman
Fei of
F 53 2011-6-20 2014-6-20 0 0 0 0 Yes
Minying Supervisor
y
Yu Xiao Supervisor M 44 2011-6-20 2014-6-20 0 0 0 0 Yes
Ye Honglin Supervisor M 40 2011-6-20 2014-6-20 0 0 0 0 Yes
Staff
Shang Wen M 45 2011-6-20 2014-6-20 0 0 0 0 NO
Supervisor
Zhang Staff
M 53 2011-6-20 2014-6-20 0 0 0 0 NO
Ruhe Supervisor
Executive
Liu
deputy M 49 2011-6-20 2014-6-20 0 0 0 0 NO
Hongwei
chairman
Yu Deputy
M 41 2011-6-20 2014-6-20 0 0 0 0 NO
Wanchun Chairman
Deputy
Li Daijiang M 45 2011-6-20 2014-6-20 0 0 0 0 NO
Chairman
Wang Deputy
M 53 2011-6-20 2014-6-20 0 0 0 0 NO
Yingmin Chairman
Deng Deputy
M 42 2012-3-9 2014-6-20 0 0 0 0 NO
Xiaohui Chairman
Secretary
Li Xia of the F 31 2011-6-20 2014-6-20 0 0 0 0 NO
Board
Total -- -- -- -- -- 0 0 0 0 -- --
Directors, supervisor and senior executives who awarded equity incentive in report period
□Applicable √Not applicable
19
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
II. Post holding
(I) Post holding in shareholders’ unit
√Applicable □Not applicable
Whether received
remuneration
Service term Service term
Name Shareholders’ unit Post occupied from
from ended
shareholders’ unit
or not
Deputy Chairman,
Sichuan Changhong GM, Standing
2011.06.08 2014.06.08 Yes
Electronic Co., Ltd. Committee of the
Liu Tibin Party Committee
Huayi Compressor Co., Ltd. Chairman 2012.3.15 2015.3.15 No
Sichuan Changhong
Director - - No
Electronic Group Co., Ltd
Sichuan Changhong
Deputy GM 2011.06.08 2014.06.08 Yes
Electronic Co., Ltd.
Li Jin Huayi Compressor Co., Ltd. Deputy Chairman 2012.03.15 2015.03.15 No
Sichuan Changhong
Director - - No
Electronic Group Co., Ltd
Hefei Xintai Holding Co.,
Sun Liqiang Chairman 2002.07.01 - Yes
Ltd.
Sichuan Changhong
Yu Xiao CFO - - Yes
Electronic Group Co., Ltd
Sichuan Changhong
Ye Honglin CFO 2011.06.08 2014.06.08 Yes
Electronic Co., Ltd.
Sichuan Changhong Chairman of the
2011.06.08 2014.06.08
Electronic Co., Ltd. Supervisory
Ministry of Audit
Department, Yes
Sichuan Changhong
Fei Minying deputy Secretary - -
Electronic Co., Ltd.
of Discipline
Committee
Chairman of the
Huayi Compressor Co., Ltd. 2012.03.15 2015.03.15 No
Supervisory
Explanation on
Ms. Fei Minying is now under the Changhong Group, a subsidiary of Sichuan electronic military
job occupation
Holdings Limited and other companies served as Chairman of the Supervisory Board and other
in shareholders’
duties.
unit
(II) Post holding in other unit
√Applicable □Not applicable
Whether received
Post Service term Service term remuneration
Name other unit
occupied from ended from other unit or
not
Liu Youpeng Shanghai Business School Professor 2002-7 - Yes
Explanation on
job occupation Mr. Liu Youpeng now also serves as an independent director of the Anhui Quanchai limited
in shareholders’ liability company.
unit
20
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
III. Remuneration of directors, supervisors and senior executives
1. Allowance plan of independent directors are implemented after deliberated
Procedure for
in the Board and approved in Shareholders’ General Meeting. Other directors
deciding
remunerations of and non-staff supervisors except independent directors are received no
directors, remuneration from the Company.
supervisors and 2. Remuneration of senior executives are deliberated and approved by the
senior management Board according to remuneration evaluation plan together with opinions of
Remuneration and Evaluation Committee.
Bases on which The Company conducted the performance examination on the task of
remunerations of directors, supervisors and senior executives according to the HR management
directors, policy, wages of directors, supervisors and senior executives are decided by
supervisors and their performance and evaluations check by the Company. All wages are
senior management performing by the evaluation results according to the only evaluation standard
are decided that carried by the Company.
Allowance of the independent directors are paid by the standards approved in
Annual Shareholders’ General Meeting; Remunerations for senior executives
Actual payment of of the Company are paid strictly by the unify remuneration valuation
remunerations of mechanism of the Company.
directors, Current directors, supervisors and senior executives of the Company has 20 in
supervisors and total, actually 10 person receiving remuneration from the Company, 2 staff
senior management supervisors are received their remuneration by actual positions
(non-supervisor post); furthermore, 4 independent directors are received the
allowance monthly from the Company; the Company will pay remuneration
to senior executives monthly/quarterly/annually.
IV. Changes of directors, supervisors and senior executives
Name Post holding Changes Date of changes Reasons of changes
According to the company's
Deng management needs, nominated and
Vice president Appointment 2012-3-9
Xiaohui review by the Nomination Committee
and appointed by the Board.
V. Staff of the Company
Person on-jobs 3802
Retirement person whose charges undertake by
783
the Company
Professional categories
Types of professional category Numbers of professional category
Production staff 1575
Salesman 716
Technician 398
Financial staff 95
Administration staff 459
others 559
Education background
Type of education background Numbers (people)
High school and below 2038
21
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Junior college 764
Undergraduate 941
Master 57
Doctorate 2
Statement: The employees less than that of year-end of 2011 mainly because the domestic finished
products logistic management was trusted to third party for manage; former employees of logistic
department are volunteers to work in the third party logistic company.
22
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter IV Report of the Board of Directors
I. Management discussion and analysis
(I) General operation activities of the Company in reporting period
In 2012, the international macro-environment is still very severe, European debt crisis is
increasingly worsening, the economy in Euro zone continues to deteriorate, and the United States is
still in economic downturn; the domestic economic growth also declines, the amount of increase in
housing price and price of commodities obviously reduces, the export growth sharply drops, the
investment and consumption growth decrease, and the economic growth rate still appears to be in
downturn trend; the household electrical appliance industry market rapidly slows down and faces
pressures such as cost rising, and excess production capacity. Confronting the new situation, under
the guidance of Meiling Dream suggested by the board of directors, the Company rebuilds
enterprise culture, establishes integrity, wisdom and courage as the core value, and implements the
core strategies, i.e. product strategy, talent strategy and cost leadership strategy, and carries out
significant strategies, i.e. market strategy, brand strategy and internationalization strategy.
From 2012 to 2014, the Company will positively develop “phoenix” competition activities so
as to realize the target that the domestic and abroad sales market of refrigerator and freezer becomes
the second largest among the domestic enterprises, all staff of the Company shall take part in this
competition.
In the first half year of 2012, the Company has continued to insist on the management
principle of “product upgrading, cost optimizing, quality service and innovation”, ensured the
Company’s stable development, and obtained a stable performance in operation basically; the
Company has gained operating income of 53.13 hundred million Yuan, down by 2.97%
year-on-year; achieved operating profit of 1.26 hundred million Yuan, up by 472.95% year-on-year,
and obtained net profit of 1.11 hundred million Yuan belonging to the parent company, down by
12.13% year-on-year.
(II) Technical innovation of the Company during the report period as well as
energy-saving and emission reduction
The Company’s technical innovation closely combines with the user need, focuses on
developing energy-saving products and high-end products for domestic sales market, and
developing energy-saving products and products with large volume for overseas market. The
product and technology development of the Company mainly centers on energy saving, air cooling,
wisdom and copious cooling. Particular cases are as following:
1. Energy-saving technology
The Company always insists on the exploration and development of energy-saving technology,
and research and development of multiple core energy-saving technology for refrigerator and
23
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
freezer, which makes the Company be the leader in home appliance energy-saving field for many
times. The Company carries out continuous and deep research on refrigeration cycle, the integrated
design of refrigerator/compressor, air duct design, efficient defrosting, frequency conversion, active
control, foam materials and craft, heat exchanger, and sealing and heat insulation, and gets excellent
achievements.
2. Air cooling technology
Air cooling technology is also the Company’s key technical research at present. The Company
devotes to the research on energy saving of air cooled refrigerator, improving temperature
uniformity, reducing noise, lessening feedback, enhancing the market competitiveness of air cooled
refrigerator with large volume.
3. Intelligent technology
The intelligentization of home appliance is the hot topic of the industry, and the Company has
done a lot of research on intelligent products. After the first generation intelligent products came
into the market, the Company continues to research and the second generation products came into
the market in the first half year of 2012, and the third generation will come soon.
4. Copious cooling technology
The company makes use of the refrigerant mixture throttle refrigeration technology, and
successfully develops and researches the first two-door, dual temperature, double control and
ultralow temperature refrigerated storage bin in China, and is able to make mass production. The up
and down rooms of the refrigerator have completely independent dual refrigeration system and
double control system, which work at the same time and greatly enhance the safety of living beings
storage. The lowest storage temperature of the copious cooling refrigerator of the Company can
reach -192℃.
5. Air conditioning technology
The Company firmly grasps the frequency conversion trend of domestic air conditioner, and
does research by following energy saving and comfort. The 0.1℃ accuracy temperature control
technology DC inverter air conditioner with leading proprietary intellectual property rights in China
has massively come into the market. Based on it, the research and development of the Company’s
air conditioner that has the leading second generation accuracy temperature control technology,
which combines electronic expansion valve control and sensor-less brushless DC motor driver, has
completed, and has been applied in series of products with frequency conversion, energy-saving,
and high-efficiency.
6. Technical innovation
While doing self-dependent innovation, the Company integrates and applies other industries
such as scientific and technological achievements or resources of Pan Hong system, research
institutions and high-tech companies, makes the second technical innovation to self-owned products,
and achieves breakthroughs in core and key technologies.
In reporting period, the Company strengthening investment in aspect of environment
24
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
protection and energy-saving and emission reduction, including waste treatment and relevant
equipment’s reformation for sewage, wastewater, residue and dust; in first half year of 2012, the
Company proactively respond to the requirement of promotion of energy-saving and emission
reduction from government department, organizing vary energy-saving reformation for powers in
order to reducing energy consumption; reducing production cost by using less energy for quality
promotion.
(III) Highlights of the Company’s operation during report period
1. The Company develops “phoenix” competition activity, all staff of the Company shall take
part in this competition, and get supports and cooperation from coherent units so as to strive to
realize the target that the domestic and abroad sales market of refrigerator and freezer becomes the
second largest among the domestic enterprises in three years.
2. The Company positively develops management activities to promote the standardization,
perfect and improve the Company’s operation level, implements 56 special activities in 7 aspects
including purchasing, finance and cost control, logistics and after-sales services, manufacturing
promotion, marketing and product research, selling risk control and cost control, and
informatization, optimizes the organizational process, advances standardization and normalization
of operation level, creates more value for the Company, and prevents operational risks.
3. The energy saving technology of refrigerator and freezer independently researched and
developed by the Company takes the leading position in the industry
The Company has won the title of China efficient and energy saving products leaders in
refrigerator based on comprehensive energy saving technology; multiple products of the Company
have been selected as the national ultra-high energy efficiency products, and awarded as high
efficiency products leaders, such as self-developed BC/BD-100DTS (Rated power consumption is
0.35kWh/24h), BCD-186XHA (Rated power consumption is 0.23kWh/24h), etc.; BCD-356WET
is the self-developed multi-door fixed-frequency product with energy efficiency grade 1whose rated
power consumption is 0.86kWh/24h.
4. The Company has the honors to win multiple technical awards
The Company has won “2011 China top ten enterprises of light industry home appliances
industry (Ranked 4)”, and “2011 China Hundred Enterprises of light industry (Ranked 11)”; the
central lab of the Company has passed CNAS, and has been approved by the safety and EEV energy
consumption of Canada Standard Association (CSA) so as to lay a foundation for getting approval
for exporting products to North America; meanwhile, the Company is declaring “national quality
control and technology assessment laboratory for refrigerator and freezer”, which has been
approved by experts.
5. The Company is short-listed in the first enterprises for popularizing energy saving
refrigerator, freezer, air conditioner and washing machine.
237 energy saving refrigerators and freezers ,248 energy saving air conditioners and 53 energy
saving washing machines that the Company first declared have all passed the evaluation, and have
25
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
been selected into the catalogue of popularizing energy saving products; the sales promotion
network (stores) for energy saving products have been put on records.
6. Refrigerator export and freezer and air conditioner sales in domestic market has increased a
lot, the respective year-on-year growth of sales volume in the first half year of 2012 is 47.1%,
38.9%, 10.8%.
7. The Meiling refrigerator production lines go into operation, effectively relieve the shortage
of production capacity, the sales volume proportion of high-end refrigerator with three or more
doors in the first half year of 2012 has exceeded 40%.
8. Develop value creating activities of a mass character, and promote profitability of the
Company.
(IV)Operation of main subsidiary of the Company and stock jointly company as well as
performance analysis
Unit: RMB 0’000
Registe Proport
r ion of
Economic
Unit Main business capital shares Total assets Net assets Net profit
nature
(RMB held
0’000) (%)
Zhongke
Meiling Domestic Low-temperatu
Low-temperatu joint-vent re refrigerator 6,000 70.00 10,381.68 7,100.67 353.22
re Technology ure and freezer
Co., Ltd.
Jiangxi Meiling Domestic Production and
Refrigeration joint-vent sale of 4,000 90.00 8,571.19 5,364.23 -64.34
Co., Ltd. ure refrigerator
Mianyang
Domestic Production and
Meiling
joint-vent sale of 10,000 95.00 13,117.63 9,367.41 243.70
Refrigeration
ure refrigerator
Co., Ltd.
Sichuan Wholly
Production and
Changhong owned by
sale of 20,000 100.00 139,045.69 36,012.92 3,115.99
Air-conditioner legal
air-conditioner
Co., Ltd. person
Zhongshan
Domestic Production and
Changhong
joint-vent sale of 8,000 90.00 34,520.50 9,159.32 351.49
Electronic Co.,
ure refrigerator
Ltd.
Cooling
Hefei Meiling
appliance, air
Electronic Domestic
conditioner,
Appliance joint-vent 5,500 99.82 106,358.57 -691.57 -1,239.40
washing
Marketing Co., ure
machine and
Ltd.
sales of goods
Hefei Meiling Wholly Manufacture of
Group Holding owned by washing 8,000 100.00 21,529.25 -1,031.74 -1,166.62
Co., Ltd. legal machine, plastic
26
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
person products, fine
welding pipe,
cooling parts,
package and
decorations;
self-manufacture
products and raw
and auxiliary
materials need by
the company,
equipment ,
instrumentation
and sales of
goods
During the report period, no investment income’s impact of single joint stock company to net profit
of the Company reaches above 10%.
(V) All risk factors may cause adverse impacts on the Company’s future development
strategy and management objectives
1. Industry growth speed rebounding is less than anticipated risks
The global economic recession and policy response are less than expected, the real estate
market remains in the doldrums, the overall situation in the first half year of 2012 is still not
optimistic, the magnitude of drop in marketing of refrigerator, freezer, air conditioner and washing
machine is beyond the industry expectation. Macro-economic situation in the next half year is still
grim, under the influence of real estate regulation and control, and the insufficient impetus in
replaceable purchase, so that it is hard for home appliance market to grow. The new subsidy policies
for home appliance energy saving may improve the expectations to some extent, but it is difficult to
change the overall downtrend.
2. Prices fluctuation risks of raw and materials
In the first half year, the price of raw materials falls, which has positive effects on profitability
of home appliance industry. If the home appliance market rebounds in the next half year, the price
of materials may fluctuate.
3. Risks of the continuous price competition
The core competition factors of home appliances industry gradually transfer from scale and
channel to brand and product, shuffle shall be the keyword to home appliance industry in 2012; to
keep the original share of the market, price war will continuous to be intensify.
(VI) The main business scope and operation state of the Company during the report
period
The Company belongs to home appliance enterprise, whose main business scope is
refrigeration appliances, air conditioners, washing machines, computer numerical control injection
molding machines, water heater, plastic products, and packing and decoration manufacturing,
manage the export businesses of self-developed products and technology, the import and export
businesses of raw and auxiliary materials, mechanical equipments, instruments and meters, and
technologies required by the Company, and the general merchandise sales and transportation.
27
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
1. Statement of main business according to industries and products for first half year of
2012
Unit: RMB
Gross
Increase/decrease Increase/decrease Increase/decrease
Operation profit
Items Operation cost in income over in cost over last in gross profit ratio
income ratio
last year (%) year (%) over last year (%)
(%)
Refrigerators
3,524,512,428.36 2,608,915,664.41 25.98% -0.43% 0.80% -0.90%
(Freezer)
Air
1,480,247,536.02 1,159,935,393.63 21.64% -2.78% -13.57% 9.78%
conditioner
Washing
68,173,774.95 54,339,892.93 20.29% 20.21% 10.32% 7.14%
machine
Other 64,941,961.36 63,326,764.38 2.49% 30.74% 60.18% -17.92%
Total 5,137,875,700.69 3,886,517,715.35 24.36% -0.59% -3.30% 2.12%
2. Statement of main business according to areas for first half year of 2012
Unit: RMB
The current year Last year
Gross Gross
Areas Operating profit Operating profit
Operating cost Operating cost
Income ratio Income ratio
(%) (%)
Domestic
4,522,151,494.79 3,289,722,049.67 27.25% 4,524,774,628.61 3,390,966,852.43 25.06%
sales
Export
615,724,205.90 596,795,665.68 3.07% 643,774,523.83 628,094,324.99 2.44%
products
Total 5,137,875,700.69 3,886,517,715.35 24.36% 5,168,549,152.44 4,019,061,177.42 22.24%
3. Explanation on reasons of material changes in main operations and its structure
□Applicable √Not applicable
4. Explanation on reasons of material changes in profitability (gross profit ratio) of main
operations compared with that of last year
□Applicable √Not applicable
5. Analysis on reasons of material changes in profit structure compared with the
previous year
□Applicable √Not applicable
6. No other business activities that influence a lot in profit in reporting period.
(VII) Internal control mechanism related with fair-value measurement
□Applicable √Not applicable
(VIII)Foreign currency financial assets and financial liabilities held
□Applicable √Not applicable
(IX) Analysis on financial status of the Company in reporting period
1. Changes of main index in profit statement as well as reason analysis:
Unit: RMB
28
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Item Jan.-June 2012 Jan.-June 2011 +/- (%)
Business tax and 43,172,959.76 19,453,852.82 121.92%
surcharge
Financial expenses -34,586,978.46 -15,240,641.58 -126.94%
Asset impairment 37,119,691.31 23,097,600.28 60.71%
losses
Non-operating income 4,579,649.44 119,542,650.05 -96.17%
Non-operating 5,625,818.80 2,143,328.48 162.48%
expenditure
Analysis of change causes
(1) Business tax and surcharges grow 121.92% from a year earlier, mainly because the payable
business tax and surcharge increased and paid in report period.
(2) Financial expenses decline 126.94% from a year earlier, mainly because the raising funds
of current period increases the interest income, and the exchange earning also increases.
(3) Asset impairment losses increase 60.71% from a year earlier, mainly because the extraction
for bad debt reserves and inventory falling price reserves increases at the current period in
accordance with accounting standard and accounting policy of the Company and by combining the
real situation of accounts receivable and inventory.
(4) Non-operating income drops 96.17% from a year earlier, mainly because the
subsidiary-Sichuan Air-conditioner doesn’t receive the subsidize revenue at the current period,
while it received the subsidize revenue at the same period last year.
(5) Non-operating expenditure increase 162.48% from a year earlier, mainly because loss on
retirement of fixed assets increases at the current period.
2. Changes of main index in balance sheet as well as reason analysis:
Unit: RMB
Item 2012-6-30 2011-12-31 +/- (%)
Note receivable 2,557,190,766.71 1,523,729,827.01 67.82%
Account receivable 1,001,666,184.42 571,218,022.80 75.36%
Account paid in
163,665,256.51 237,494,745.03 -31.09%
advance
Other account
11,131,811.36 41,508,227.47 -73.18%
receivable
Constructions in
285,537,614.98 204,053,321.44 39.93%
process
Short-term loans 243,089,994.43 144,000,000.00 68.81%
Account received in
434,002,521.83 703,404,091.67 -38.30%
advance
Taxes payable 131,041,553.42 73,939,903.98 77.23%
Other account
799,045,107.44 518,444,925.03 54.12%
payable
Non-current liability 3,405,507.92 2,452,094.16 38.88%
29
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
due within one year
Detained profit 361,598,714.44 250,743,672.24 44.21%
Foreign currency
statement translation -919,190.86 -501,107.01 83.43%
differences
Analysis of change causes:
(1) Notes receivable increase 103,346.09 million Yuan since the beginning of the year, rising
67.82%, mainly because banker's acceptance received at the peak season increases, but the
collection is not yet due.
(2) Accounts receivable increase 43,044.82 million Yuan since the beginning of the year, rising
75.36%, mainly because the credit scale given to customers at the current period increases in the
risks controllable scope resulting in accounts receivable rises; affected by business switch of joint
venture, payment period of chain customers prolongs.
(3) Account paid in advance reduce 7,382.95 million Yuan over that of year-begin, dropping
31.09%, mainly because the advance payment for goods has been settled.
(4) Other account receivable reduce 3,037.64 million Yuan since the beginning of the year,
dropping 73.18%, mainly because the Company takes back the earnest money paid to relevant
departments for home appliances to the countryside; Zhongshan Changhong takes back the export
value added tax that should be withdrawn.
(5) Constructions in process increase 8,148.43 million Yuan over that of year-begin, rising
39.93%, mainly because the raising funds increase in projects investments which have not been
completed.
(6) Short-term loans increase 9,909 million Yuan since the beginning of the year, rising 68.81%,
mainly because the short-term loans of this Company and the subsidiaries-Zhongshan Changhong
increase.
(7) Account received in advance reduce 26,940.16 million Yuan over that of year-begin,
dropping 38.30%, mainly because the shipments, billing and settlement are rapid up in peak season.
(8) Taxes payable increase 5,710.16 million Yuan over that of year-begin, rising 77.23%,
mainly because the value-added tax sharply increases in June, the sales peak season.
(9) Other account payable increase 28,060.02 million Yuan since the beginning of the year,
rising 54.12%, mainly because the occurred but not reimbursed expenses at the current period
increase.
(10) Non-current liability due within one year increases 95.34 million Yuan since the
beginning of the year, rising 38.88%, mainly because long-term loans due within one year increase.
(11) Detained profit increase 11,085.50 million Yuan since the beginning of the year, rising
44.21%, mainly because of the newly-increased profits at the current period.
(12) Foreign currency statement translation differences reduce 41.81 million Yuan since the
beginning of the year, dropping 83.43%, mainly because of foreign currency statement translation
of the overseas subsidiaries.
30
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
3. Changes of main index in cash flow statement as well as reason analysis:
Unit: RMB
Item Jan.-June 2012 Jan.-June 2011 +/- (%)
Refunds of taxes
44,962,884.98 25,730,915.85 74.74%
received
Other cash received
with operating 12,793,275.47 154,847,635.85 -91.74%
activities concerned
Taxes payable 268,142,290.34 156,316,882.18 71.54%
Other cash paid with
operating activities 272,269,140.43 413,539,305.42 -34.16%
concerned
Cash received from
- 1,000,000.00 -100.00%
investment
Net cash received
from disposal of
fixed assets,
762,052.14 71,162,183.34 -98.93%
intangible assets and
other long-term
assets
Cash paid for
purchasing fixed
assets, intangible 81,482,550.21 57,692,391.87 41.24%
assets and other
long-term assets
Cash paid for
- -22,009,000.00 100.00%
investment
Cash received from
- 35,966,000.00 -100.00%
investment absorb
Cash paid for debt
34,214,668.71 187,548,951.80 -81.76%
payment
Analysis of change causes:
(1) Refunds of taxes received increase 1,923.20 million Yuan from a year earlier, rising
74.74%, mainly because the export rebates of parent company and subsidiary –Zhongshan
Changhong increase.
(2) Other cash received with operating activities concerned reduce 14,205.44 million Yuan
from a year earlier, dropping 91.74%, mainly because the subsidiary –Sichuan Air-conditioner has
received subsidy for energy saving project at the same period of last year, but has not received at the
current period.
(3) Taxes payable increase 11,182.54 million Yuan from a year earlier, rising 71.54%, mainly
because the VAT and surcharge payable for parent company increased in this period.
(4) Other cash paid with operating activities concerned reduce 14,127.02 million Yuan from a
31
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
year earlier, dropping 34.16%, mainly because the cash settlement items decreased in this period.
(5) Cash received from investment reduce 100 million Yuan from a year earlier, dropping
100%, mainly because the parent company has taken back the investment in Hefei technology
assets and equity exchange at the same period of last year, but has not at the current period.
(6) Net cash received from disposal of fixed assets, intangible assets and other long-term assets
reduce 7,040.01 million Yuan from a year earlier, dropping 98.93%, mainly because the subsidiary,
Jiangxi Meiling, has received compensation payments of land purchasing and storage from the old
plant area at the same period of last year, but has not at the current report period.
(7) Cash paid for purchasing fixed assets, intangible assets and other long-term assets increase
2,379.02 million Yuan from a year earlier, rising 41.24%, mainly because the subsidiary, Jiangxi
Meiling, has increase the purchasing for fixed assets at the current period.
(8) Cash paid for investment increase 2,200.90 million Yuan from a year earlier, rising 100%,
mainly because the investment funds paid by the parent company to some joint marketing
subsidiaries have not been merged or countervailed as the business registration has not been
completed, the establishment of these marketing subsidiaries has been completed at the same period
of last year, and above investment funds are listed as negative in the consolidated statements.
(9) Cash received from investment absorb reduce 3,596.60 million Yuan from a year earlier,
dropping 100%, mainly because all joint marketing subsidiaries have received investments from
few shareholders at the same period of last year, but has not at the current report period.
(10) Cash paid for debt payment reduce 15,333.43 million Yuan from a year earlier, dropping
81.76%, mainly because the due bank loans repaid by the parent company at the current period
reduce.
(X) Management countermeasures of the Company in the next half year
Faced with grim macro-economic situations and industry situations, the Company shall make
Meiling be an enterprise that has a dream, respected by others, and develops with the staff under the
guidance of Meiling Dream and correct leader of the board of directors. Meiling should advocate
equality of opportunity and free competition as the enterprise culture, insist on proposing hard work
and plain living, devote to improve the quality of public life, strive to be the leader in home
appliances industry, and realize Meiling Dream.
Main management countermeasures of the Company in the next half year:
1. Continue to launch Phoenix competition activities, ceaselessly improve market shares at
home and abroad, and strengthen the comprehensive competitiveness.
2. Actively carry out special activities for internal control criterion implementation of the
Company, continue to promote the operation level and business efficiency, prevent operational risks,
and create more values for the Company.
3. Centers on core technology of “energy saving, air cooling, wisdom and copious cooling”,
strengthen development of R&D for products and improve the structure of products. Meanwhile,
accomplish the development and product quality tracking for refrigerator, freezer, washing machine
32
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
and air conditioner; accelerate the research and development for ultra-low temperature refrigeration
storage of copious cooling products; continue to advance the components and parts integration in
standardization and universalization.
4. Adhere to the idea of taking integrity, intelligence and courage as the core values, boost the
refrigerator quality services, pursue for fairness and ceaselessly deepen it.
5. Continue to develop value creation activities of a mass character, increase income and
reduce costs by improving operation efficiency.
6. Domestic and overseas sales
(1) Grasp the market opportunities of domestic sales for refrigerator, freezer and washing
machine, continue to import energy saving, mid and high-end products, and adjust the product
structure, and strengthen the product competitiveness. Carry out differentiated competition and
marketing strategies, achieve differentiated competitive advantages via technological superiorities
such as Meiling air cooling and energy saving technology; strengthen the market and product
planning for the self-owned brand, and increase the sales volume。
(2) Seize the market advantages for air conditioner domestic sales by adjusting product
structure and planning resources release and increase the overseas sales volume by actively opening
up new markets.
III. Investment of the Company in reporting period
(I) Application of raised proceeds in reporting period as well as progress of fund raised
projects
1. General information of fund raised
(1) Amount actually raised and date for fund collected
As deliberated and approved by the second extraordinary shareholders’ general meeting and
the 32nd Meeting of the 6th session of the Board, and approved by CSRC [Zheng Jian Xu Ke (2010)
No. 1715], the Company issued 116.7315 million A shares to specified 8 investors including
Sichuang Changhong in a non-public offering way with issued price of 10.28 Yuan/Share.
According to the Capital Verification (No.: XYZH2010CDA6021) issued by Shine Wing Certified
Public Accounts, total proceeds raised in this offering are RMB1,199,999,820.00 and the net
proceeds amount to RMB1,177,954,320.00 after deducted offering expenses RMB 22.0455 million
(including underwriting and sponsoring fee RMB 20.5 million).
As at 24 December 2010, the sponsor institution and the leading underwriter have transferred
the above subscription account to fixed special storage account for funds raised after deducting
margin bids for underwriting and the surplus 20.5 million yuan. Particulars are as the following:
CAPITAL
Bank A/C COLLECTED Capital used in
(RMB0’000)
Hefei Branch of China Production base for
Everbright Bank Branch in 76740188000018471 73,000.00 Athena luxury
Daoxiang Building refrigerator
33
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Hefei Branch of China
Freezer expansion
Communication Bank in 341304000018010080590 30,000.00
project
Shouchunqiao Road
Expansion project of
Industrial and Commercial
environmental and
Bank of China, Hefei branch 1302010229022129028 11,000.00
energy-saving
of the Yangtze River Road
refrigerators
Business Division of Hefei Supplemented current
Luyang Branch of China 34001468608053006232 3,949.98 capitals and partial
Construction Bank offering costs
Total 117,949.98
(2) Amount used in this year and year-end balance
In this year, RMB 261,605,914.98 raised fund have been used, RMB 2,427,768.17 interest
received from the Bank in specific account and bank handling charge costs RMB 40.
Balance of the specific account amounting to RMB 466,544,741.11 dated 30 June 2012,
interest income accumulated amounting to RMB 16,013,708.36, amount have been used
accumulated as RMB 727,423,287.25 and balance fund raised was RMB 466,544,741.11.
2. Management of fund rose
(1) Management system of fund raised
In order to normalize the management and utilization of funds raised, improve utilization
efficiency and interest of capitals, actually protect interests of investors, in accordance with relevant
laws and rules, the Company formulated the “Management System of Funds Raised of Hefei
Meiling Co., Ltd.”, which made detailed and strict rules for the special deposits account, utilization,
allocation change as well as management and supervision of funds raised. The system has been
deliberated and approved in 2010 the second Extraordinary General Meeting of Shareholders and
the 32nd meeting of the 6th Session of the Board.
In the report period, the Company strictly performed procedures of application and approval by
relevant regulations listed in “Management System of Funds Raised of Hefei Meiling Co., Ltd.”
while using the fund raised. Highering efficiency and utilization of the capital and protect investor’s
interest conscientiously.
(2) The signing and execution of tripartite regulatory agreement
In accordance with “Management System of Funds Raised of Hefei Meiling Co., Ltd”, the
Company saving the raised fund in specific accounts since January 2011 and open a specific
account for raised fund in the Bank. On 7 January 2011, the Company signed the “Tripartite
Regulatory Agreement of Funds Raised” for clarified liabilities and responsibility between the
parties respectively with China Everbright Bank Hefei Branch Daoxiang Building Sub-branch,
China Communication Bank Shouchun Road Bridge Sub-branch, China Industrial and Commercial
Bank Hefei Yangtze River Road Sub-branch and China Construction Bank Hefei Luyang
Sub-branch as well as the sponsor institution China Merchant Securities Co., Ltd. At the same day,
34
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
the Company put on record to Shenzhen Stock Exchange and reported the main contents of this
agreement. Implementation of the tripartite regulatory agreement shows no problems within the
report period.
(3) Special deposit account for funds raised
As at 30 June 2012, project of raised fund totally accumulative used RMB 727,423,287.25
(excluding the RMB 300 million that supplied current capital with idle raised fund temporary)
actually. Balance at raised fund was RMB 466,544,741.11 (including RMB 16,013,708.36 interest
income, and regardless of the particular of supplementation of current capital with idle raised fund
temporary).
As at 30 June 2012, fund raided in privately offering were saving as:
Details Saving Information
Balance ( RMB ’0000)
Bank Fund used in A/C Raised Interest Note (fixed
Total
capitals income deposit
China Everbright Production
Bank Hefei Branch base for
76740188000018471 32,168.1344 1,424.3443 33,592.4787 20,000.00
Daoxiang Building Athena luxury
Sub-branch refrigerator
China
Capacity
Communication
expansion
Bank Shouchun 341304000018010080590 12,895.4514 166.5440 13,061.9954 13,000.00
profit for
Road Bridge
freezer
Sub-branch
Expansion
China Industrial
project of
and Commercial
environmenta
Bank Hefei 1302010229022129028 -9.1034 9.1034 0.0000 0.00
l and
Yangtze River
energy-saving
Road Sub-branch
refrigerators
Business Division of Current
Hefei Luyang capital
34001468608053006232 -1.3791 1.3791 0.0000 0.00
Branch of China supplementar
Construction Bank y
Total - - 45,053.1033 1,601.3708 46,654.4741 33,000.00
Note: According to the usage schedule for projects of raised fund, fund raised in ICBC and
China Construction Bank are clearing. The amount used in raised fund projects are larger than the
amount actually raised due to the bank interest arising in specific raised fund account. Project of
capacity expansion for environmental and energy-saving refrigerators gains interest of RMB 91,034
while project of current capital supplementation gains RMB 13,791 interest. As a result balance at
the above accounting to RMB -91, 034 and RMB-13,791 respectively. Take the interest income into
consideration, balance at ICBC and CCB was RMB 0 and have been verified.
35
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
3. The actual usage of raised capitals of this year
(1) Comparison table of the actual usage of raised capitals
36
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Comparison table of the actual usage of fund raised ended as 30 June 2012
Unit: RMB (0’000)
Total fund-raised 117,795.4320 Total fund-raised used in this year 26,160.5915
Total fund-raised for changes its using purpose in report period 0
Total accumulative fund-raised for changes its using purpose 0 Total fund-raised used accumulated 72,742.3287
Proportion of total fund-raised that with using purpose changed 0.00%
Reach
Investment the Project
Amount of
Projects changed Total committed program till predict feasibility
Committed investment Total investment after Amount invested in accumulated Predicted useable date Realized interests of this
or not (including investment of the ed changed
projects adjustment (1) report period investment till the of project year
changed partially) fund-raised period-end interes significant
period-end (2)
(3)=(2)/(1) t or ly or not
not
Capacity expansion
1st phase:2012.6 Un-chan
for Athena Luxury Unchanged 73,000.0000 73,000.0000 24,770.3141 40,831.8656 55.93% nd
- -
2 phase:2012.12 ged
refrigerator
Freezer expansion 1st phase:2011.1 1st phase: 2,149.39 Un-chan
Unchanged 30,000.0000 30,000.0000 1,390.2774 17,104.5486 57.02% nd nd
No
project 2 phase:2013.4 2 phase: Nil ged
Expansion project of
environmental and Un-chan
Unchanged 11,000.0000 11,000.0000 0.0000 11,009.1034 100.08% 2010.12 1,544.62 No
energy-saving ged
refrigerators(Note5)
Supplementary of Un-chan
Unchanged 3,795.4320 3,795.4320 0.0000 3,796.8111 100.04% - - -
current capital ged
Total - 117,795.4320 117,795.4320 26,160.5915 72,742.3287 61.75% -
Using purpose for fund-raised No fund-raised collected out of plan
37
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Loans payment to
- - - - -
Bank(if applicable)
Current capital
supplementation(if - - - - -
applicable)
Subtotal of Capital
investment with
- - - - -
fund raising out of
the plan
Total - - - - -
Reasons for falling behind the target progress or target income(By specific items) Note1, Note 2
Statement for major change of project feasibility N/A
Amount, using purpose and progress of using for fund-raised out of the plan N/A
Change of implementation place of investment project of fund-raised N/A
Regulation of implementation ways of investment project of fund-raised N/A
Preliminary investment and replacement of investment project of fund-raised Note3
Temporarily supplement for the current capitals with idle fund-raised Note 2 of Temporarily supplement for the current capitals with idle fund-raised
Amount and reason for surplus of fund-raised when implementing projects N/A
Usage of the retained raised fund and what is expected to invested with those fund Note 4
Problems exits in usage and disclosure of the raised fund and other information N/A
38
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Note 1: The Phase I of capacity expansion projects for Athena luxury refrigerator has reached
its expected serviceable condition with annual capacity of 1.2 million refrigerators (double shifts)
produced. Part of first stage of the Phase II have been put into trial production, whose capacity can
reach annul output of 0.4 million refrigerators (double shifts).
The first stage of Phase II of freezer capacity expansion project has been put into production,
whose capacity can reach annul output of 0.4 million freezers. The Company’s current production
capacity for freezers can satisfy the marketing plan of 2012. To make rational use of resources, the
Company shall adjust the realization time of production of the second stage of Phase II of freezer
capacity expansion project to April, 2013 according to the annul freezer sales target in 2013.
In the first half year of 2012, the year-on-year growth of domestic home appliance marketing
and sales is slow, the refrigerator and freezer markets remain in downturn, and the labor costs and
transportation costs keep rising, which cause the implementation of the Phase I of capacity
expansion projects for freezer and the capacity expansion project for environmental protection and
energy saving refrigerator has not reached the predicted benefits.
Note 2: the capital invested in capacity expansion of Athena luxury refrigerators and capacity
expansion of freezers as actual schedule, and in the light of relevant terms, the accounts such as
infrastructure and equipments of items were paid one by one in the light of implementation
schedule and contract agreement. The period-end investment progress of supplementary current
capital has been beyond 100% mainly due to the used raised capital including deposit interest of
raised capital.
Note 3: Preliminary investment and replacement of investment project of fund-raised
As at 15 January 2011, the Company engages Shine Wing Certified Public Accountants for
specific auditing on the fund-raised project, collecting privately, that invested by self-collecting
fund of the Company. Being audited, particular about fund-raised projects invested by
self-collecting fund of the Company as at 15 January 2011 are:
Invested amount from
No. Name of projects
self-collecting capitals
1 Athena Luxury refrigerator production base 241,684.00
2 Freezer expansion project 72,959,508.44
Expansion project of environmental and
3 15,580,344.77
energy-saving refrigerators
Total 88,781,537.21
Note: part of the above accounts calculated by means of bank acceptance bills and negotiable
endorsement of bank acceptance bills.
Shine Wing Certified Public Accountants Co., Ltd. has issued the “Special Approval Report
about Hefei Meiling Co., Ltd’s Self-collecting Capitals Investing in Invested Items of Funds Raised
“(XYZH/2010CDA6038) on 17 January 2011. The replacement was agreed by the sponsor
institution China Merchants Securities Co., Ltd, and was reviewed and approved on the 41st meeting
39
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
of the 6th Session of the Board. And at the same time, the independent directors, board of
supervisors issued concurring opinion.
Note 4: Usage of the retained fund-raised and what is expected to invested with those fund
For the purpose of reducing the financial cost and higher the efficiency of raising fund, Partial
raising fund was consented for temporary supplementation for circulating capital under the premise
of no impact on the investment project implementation, and withdrew the fixed deposit.
Note 5: RMB 110 million was invested in capacity expansion of environmental and
energy-saving refrigerators, including RMB 50 million was used in capital increase of Mianyang
Meiling for environmental and energy-saving refrigerators production line which produces and
processes environmental and energy-saving refrigerators. The increase capital had been done. RMB
60 million had been used in R&D of environmental and energy-saving refrigerators, purchase of
raw materials and sales which had been used up. Thus book funds of the special account of raised
capital had been used up.
Till presently, the using purpose of fund-raised hasn’t been changed.
(2) Explanation on the temporary supplementation of circulating capital from idle raising
fund
For purpose of reducing the financial cost, higher the efficiency of raising fund, the Proposal
of temporary supplementation of circulating capital from partial idle raising fund has been
deliberated and approved by 43rd Meeting of 6th Board of Directors and 14th Meeting of 6th Board of
Supervisors. Partial raising fund was consented for temporary supplementation for circulating
capital under the premise of no impact on the investment project implementation, amount of RMB
60 million raised fund within 6 months term, which is from 25 March 2011 to 25 September 2011.
Meanwhile, independent directors and supervisors shows favor opinions for that. The used idle
raised fund of RMB60 million has been returned to the specific raised fund account on time dated 2
June 2011. The above matters have been disclosed by the Company in media including Securities
Times, China Securities Journal, Hong Kong Commercial Daily and www.cninfo.com.cn as notice
(No. 2011-017, No. 2011-018, No. 2011-019 and No. 2011-033) dated 26 March and 3 June 2011.
For purpose of maximized the usage of raising fund, reduced the financial expenses, lower the
operational cost and under the premise of ensure the capital requirement for investment project, the
Proposal of temporary supplementation of circulating capital from partial idle raising fund has been
deliberated and approved by 47th Meeting of 6th Board of Directors, 16th Meeting of 6th Board of
Supervisors and 2nd Extraordinary Shareholders’ General Meeting 2011. Partial raising fund was
consented for temporary supplementation for circulating capital, amount of RMB 500 million
within 6 months since the date of approval day from Shareholders’ General Meeting, which is from
23 June 2011 to 23 December 2011. Furthermore, the event has been approved by the sponsor and
independent directors. The used idle raised fund has been returned to the specific raised fund
account on time dated 1 December 2011. The above matters have been disclosed by the Company
in media including Securities Times, China Securities Journal, Hong Kong Commercial Daily and
40
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
www.cninfo.com.cn as notice (No.: 2011-034, No. 2011-035, No. 2011-037, No. 2011-042 and No.
2011-060).
For purpose of higher the efficiency of raising fund, reducing the financial expenses, lower the
operational cost and under the premise of ensure the capital requirement for investment project, the
Proposal of temporary supplementation of circulating capital from partial idle raising fund has been
deliberated and approved by 7th Meeting of 7th Board of Directors, 4th Meeting of 7th Board of
Supervisors and 5th Extraordinary Shareholders’ General Meeting 2011. Partial raising fund was
consented for temporary supplementation for circulating capital, amount of RMB 400 million
within 6 months since the date of approval day from Shareholders’ General Meeting, which is from
21 December 2011 to 21 June 2012. Furthermore, the event has been approved by the sponsor and
independent directors. The used idle raised fund has been returned to the specific raised fund
account on time dated 22 May 2012.The above matters have been disclosed by the Company in
media including Securities Times, China Securities Journal, Hong Kong Commercial Daily and
www.cninfo.com.cn as notice (No. 2011-061, No. 2011-062, No. 2011-063, No. 2011-068 and
No.2012-016) dated 6 December, 23 December 2011 and 23 May 2012.
In order to improve capital availability factor, reduce financial expenses, satisfy business
requirements and protect interests of the Company and all shareholders, the 13th meeting of the 7th
session of Board of Directors, the 8th meeting of the 7th session of Board of Supervisors and the 1st
extraordinary shareholders' meeting 2012 approved and passed RMB 300 million of idle raised
capital making for flow capital temporarily with a operating life within 6 months dating from the
approval day namely from Jun. 12 of 2012 to Dec. 12 of 2012. That proposal was accepted by
independent directors and sponsors, too. All these events had been disclosed on Securities Times,
China Securities Journal, Hong Kong Commercial Daily and Juchao Website in form of report on
May 26 of 2012 and Jun. 13 of 2012 (No. 2012-017, No. 2012-018, No. 2012-019, No. 2012-025).
The Company has been strictly performing relevant obligations to return the idle capital to the
specific raised fund account within 6 months since the date of approved by Shareholders’ General
Meeting till now.
4. Particular about the raising fund of investment projects
(1) Manufacture bases of Athena Luxury refrigerator
The project is divided into two phases. It is expected to invest RMB793.3038 million in total;
of which raising fund is RMB730 million and the balance shall be raised by self-Collecting. Upon
the completion of the first phase, the annual production capacity will reach 1.2 million refrigerators
with triage-door and multi-door and side by side refrigerators with 220L; upon the completion of
the second phase, the annual production capacity will reach 0.8 million.
Up to the end of June 2012, the used raising fund for the project was RMB 408,318,656,
saving interest gains RMB 14,243,443 and the balance of raising fund was RMB 335,924,787.
Till recently, the Phase I of capacity expansion projects for Athena luxury refrigerator has
reached its expected serviceable condition with annual capacity of 1.2 million refrigerators (double
41
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
shifts) produced. Part of first stage of the Phase II have been put into trial production, whose
capacity can reach annul output of 0.4 million refrigerators (double shifts).
(2) Capacity expansion of freezer
The project is divided into two phases. It is expected to invest RMB375.1778 million in total;
of which raising fund is RMB300 million and the balance shall be raised by self-Collecting. Upon
the completion of the first phase, the annual production capacity will reach 600,000 freezers, and
the first phase of the project has been put into production in January 2011. The Company adjusted
the technical solution of partial equipment in the second phase of capacity expansion item of freezer
due to the adjustment of product mix according to the market situation. Till the end of reporting
period, the 1st stage of the 2nd phase of project had been constructed and formally put into
production in March 2012. Thus productivity reached 400000 sets of refrigerators each double-class
annually. While the 2nd stage had been started in July 2012 and will be put into operation in Apr. of
2012 by plan in accordance with refrigerators expansion plan. The 2nd stage started in order to
supplement related crafts equipments such as case foaming equipments, door-body foaming
equipments and front-end homemade equipments, thus perfected affiliated facilities. Now annual
productivity of refrigerators increased by 200,000 sets; after the completion of the 2nd stage, the
expansion plan will succeed with an annual productivity of 1.2 million sets of refrigerators each
double-class.
(3) Capacity Expansion of Environment Protection and Energy Saving Refrigerator
RMB118.0093 million was expected to invest in capacity expansion of environmental and
energy-saving refrigerators, of which RMB110 million is raising capital, including RMB 50 million
was used in capital increase of Mianyang Meiling for environmental and energy-saving refrigerators
production line which produces and processes environmental and energy-saving refrigerators; RMB
60 million had been used in R&D of environmental and energy-saving refrigerators, purchase of
raw materials and sales which had been used up. This construction will create a productivity of 0.6
million sets (double classes) of refrigerators with environmental protection and energy-saving. The
capacity expansion of environmental and energy-saving refrigerators had been put into production
in late December 2010 and it operated well.
5. Using purpose of changed fund-raised investment projects
No using purpose of fund-raised investment projects changed in this year for the Company.
6. Problems exits in usage and disclosure of the fund-raised
The Company had established and perfected administration system for raised capital of listed
companies, and guaranteed its effective implementation. The condition concerning storage and
usage of raised capital had been disclosed timely, truly, accurately and completely. There existed no
condition against the management system for raised capital.
(II) Particulars about majority invested items with non-raised capital in reporting period
√ Applicable □ Not applicable
Unit: RMB0’000
42
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Disclosure
date of
Items Amount Progress Revenue
initial
report
Till end of Jul. Of
2012, the project
went on smoothly,
having completed
civil engineering
packaging
operation and steel
installation of main
Relocation and expansion
pack workshop
of Jiangxi Meiling
2011-5-28 26,924.12 material storage None
Electrical Equipments Co.,
workshop and
Ltd
injection and
absorbing plastic
workshop.
Equipments are in
debugging. It's will
be put into
operation in the 1st
10 days of Aug.
Total 26,924.12 -- --
Statement on majority invested items with non-raised capital
According to freezers industrial strategy and plan of new production base in Jiangxi Jingde
Town, combining the strategic relocation of Jiangxi Meiling, the Company held the 46th meeting
of the 6th session of Board of Directors on May 27 of 2011 which approved and passed Proposal
About Relocation And Expansion Of Subsidiary Jiangxi Meiling Co. Ltd. Proposal agreed projects
about relocation and expansion and Jiangxi Meiling Electricity Equipments' investment and
establishment on production for energy-saving freezers. Total investment amounted to
269,241,200 yuan, including, intangible assets (land use right) and fixed assets amounted to
233,927,200 yuan, flow assets amounted to 35,314,000 yuan. Jiangxi Meiling raised these assets
by his own. This project will produce 1 million sets of environmental energy-saving freezers
(double-class) after being put into operation.
Till end of July 2012, the project went on smoothly, having completed civil engineering
packaging operation and steel installation of main pack workshop material storage workshop and
injection and absorbing plastic workshop. Equipments are in debugging. It will be put into
operation in the 1st 10 days of August.
IV. The modification of Board to the business plan for the second half of the year
□Applicable √Not applicable
V. Prediction of business performance from January – September 2012
Estimation on accumulative net profit from the beginning of the year to the end of next report
period to be loss probably or the warning of its material change compared with the corresponding
period of the last year and explanation on reason
□Applicable √Not applicable
43
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
VI. Explanation on “Qualified Opinion” from the Certified Public Accountants in the
report period by the Board of Directors
□Applicable √Not applicable
VII. Explanation of the Management on changes and disposal of the issues involved in
“Qualified Opinion” from the Certified Public Accountants in the last year by the Board of
Directors
□Applicable √Not applicable
VIII. Stating the discussion results issued by the Board on changes in the Company’s
accounting policies and accounting estimates or reasons for material accounting error
correction and influences thereof
□Applicable √Not applicable
IX. Formulation and implementation of cash dividend policies of the Company
(I) Regulation of profit distribution carried in original “Article of Association” in
reporting period
Relevant regulation of profit distribution carried in “Clause 156” of “Chapter VIII Financial
Accounting System, Profit Distribution and Auditing” in original “Article of Association”:
Formulation of profit distribution plan should following the principle as:
1. The Company should put emphasis on reasonable return to shareholders, conduct positive
profit distribution policy. In terms of profit distribution plan, we can take reasonable way of cash,
stocks or capital reverse into shares and other legal regulative ways to distribute profit. When
profiting more and having sufficient cash flow, the Company could distribute profit with cash in
middle or end of the year. The distribution proportion couldn't be lower than 30% of accumulative
profit-available-for-shareholders. The specific ratio should be determined by Board of Directors
through Shareholders' Meeting who made decision according to related rules made by CSRC and
real operation status.
Consistence and stabilization should be in profit distribution.
2. If Board of Directors didn't make any profit distribution plan when there was profit available,
they should disclose reasons and independent directors should raise up independent opinion.
3. If any shareholders occupy capital of the Company, the Company should deduct his cash
dividend for paying back capital he occupied.
(II) Implementation of cash dividend policy
The Company strictly distributed profit according to related rules and regulations of the
original Articles of Association. Cash dividend was fully used during profit distribution. The 2011
annual profit distribution plan complied with rules of Articles of Association and requirements of
shareholders' meeting. Dividend basis was clear and related decision procedure and mechanism was
complete. Independent directors issued independent opinion. Medium and little shareholders issued
suggestion and requirements through shareholders' meeting and phones. Thus their rights were
protected.
44
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
On 20 March 2012, the 10th meeting of the 7th session of Board of Directors approved and
passed Pre-Plan About 2011 Annual Profit Distribution and Capital Reserve into Shares. This
proposal was submitted to 2011 annual shareholders' meeting of the Company. Meanwhile,
independent directors issued acceptance opinion on this proposal and Directors of Supervisors
approved and passed it. The Company comprehensively considered interest of shareholders and
development requirements, turned capital reserve into shares with 2 shares including 0.5 yuan cash
dividend (tax included) per 10 shares. Total cash dividend sent to shareholders amounted to RMB
31,822,466.9 (cash dividend took up 30% of 2011 consolidated statements attributed to profit of
parent company). The capital reserves into shares reached 127289868 shares while the capital
reserve parent company used to turn into shares amounted to 127289868 yuan of capital stock
premium in its own detailed accounting subject. After this distribution, total share capital will
increase to 763,739,206 shares from 636,449,338 shares. The undistributed profit will be done at
end of year. On Jun. 26 of 2012, the 2011 annual shareholders' meeting approved and passed
pre-plan about the beforehand 2011 annual profit distribution and capital reserve into shares.
(III) Adjustment to cash dividend policy at reporting period-end
At reporting period-end, the Company positively organized Board of Directors, Board of
Supervisors and senior managers to learn the spirit in Notice, namely Notice to Further Conduct
Related Issues about Cash Dividend issued by CSRC ZJF No. [2012] 37 (hereinafter referred to as
Notice) and Transferred Notice to Further Conduct Related Issues about Cash Dividend Issued by
CSRC made by Anhui SRC (WZJHZ No. [2012] 140). And we revised and perfected it in contrast
with the Notice on Jun. 26 of 2012. The revised contents included decision procedure of cash
dividend and mechanism, period interval, actual condition, lowest account and ratio, fully listening
to opinion on profit distribution and specific insurance measurements from independent directors
and medium and little shareholders, and regulation to cash dividend policy. Condition and
procedure of cash dividend regulations is lawful and clear.
On 1 June and 26 June of 2012, the Company respectively held the 14th meeting of the 7th
session of Board of Directors and 2011 Annual Shareholders' Meeting which approved and passed
Proposal about Revision to Partial Terms of Article of Association and Proposal about Revision to
Partial Terms of Official Discussion Rules of Shareholders' Meeting. Thus we completed the
perfection and revision to terms about profit distribution shown in Article of Association especially
terms related to cash dividend.
1. Related revision to “Article of Association”:
(1) Article 78 in Chapter IV Shareholders and Shareholders' Meeting
Now revised to: the following issues should be approved though special decision made by
shareholders' meeting:
(I)The Company reduces or increases registered capital
(II) Bond issuing of the Company
(III) Division, combination, dissolution and liquidation
45
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(IV) Revision to this Article of Association
(V) Repurchase stock of the Company
(VI) The Company purchases sell major asset or guarantee amount exceeds 30% of total assets
audited during recent period
(VII) Equity stimulation plan
(VIII) Regulation or change to cash dividend ruled by Article of Association
(IX) Other issues which the law, regulation or Article of Association rules, shareholders'
meeting takes as important by ordinary decision and needed approved through special decision.
(2) Article 156 in Chapter VIII Financial Accounting System, Profit Distribution and Audit
Now revised to: profit distribution policy is as follow:
(I) Principle: the Company conducts persistent, stable and clear profit distribution policy,
protect interests of shareholders, fully maintain assets earnings of shareholders, and insure
long-term and sustainable development of the Company.
(II) Profit distribution form and ratio:
1. When profit is available, the Company distributes profit with cash or stock after
withdrawing capital reserve.
2. When cash flow could satisfy normal and long-term development, ratio of single annual
distributed profit with cash couldn't be lower than 15% of profit available for distribution realized in
current year. The rest retains for sustainable development of the Company.
3. On condition that share capital scale and equity structure is reasonable, the Company could
send stock dividend on basis of rewarding shareholders and sharing corporation value as long as the
stock appraisement is among a rational range.
4. The profit distributed couldn't be more than the accumulative profit available for
distribution.
(III) Period interval of profit distribution: the Company makes profit distribution annually, or
middle cash dividend or stock dividend according to profiting and capital requirements condition.
(IV) Decision procedure of profit distribution policy:
When profit the Company realized conforms to distribution terms, the Board of Directors
should make medium profit distribution plan (under condition of planned medium distribution) and
annual profit distribution plan in accordance with operation and market.
Profit distribution plan made by Board of Directors should be approved by more than half of
Board of Directors, and independent directors should approve and issue opinion on this plan.
Board of Supervisors should approve and issue opinion on profit distribution plan made by
Board of Directors.
Report of decision of Board of Directors should include opinions from independent directors
and Board of Supervisors.
Board of Directors should submit profit distribution plan to shareholders' meeting for approval
after they approved and passed it. When shareholders' meeting reviewing, the Company should
46
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
offer channels such as website voting for shareholders thus they can get involvement in.
The Company obtained profit in last accounting year. If Board of Directors didn't made any
profit distribution plan or didn't distribute profit with a lower ratio than the one the article ruled in
last period, the Company should give reasons for not being there, as well as the final usage of the
undistributed profit. Independent directors and supervisors should issue reviewed opinion.
If the Company has to regulate profit distribution policy because of substantial change to
operation and production, requirements from investment and long-term development, proposal
should be raised up from the Board of Directors in accordance with actual condition and should be
submitted to shareholders' meeting for approval. Including, regulation or change to cash dividend
policy should be proved fully and given reason in proposal, and should be approved by above 2/3
attending shareholders. The regulated one should focus on interests of shareholders and for related
rules of CSRC and Stock Exchange. Independent directors and supervisors should issue reviewed
opinion. The Company should offer channels such as website voting in order to attract convenient
involvement from public shareholders.
Verification, formulation and revision process of profit distribution policy should listen to
opinion from independent directors and social shareholders. The Company should listen opinion on
profit distribution policy of the Company from investors through phone consulting, site research,
interactive platform and other methods.
(V) If illegal occupation of capital of the Company exists, the Company should deduct cash
dividend for the shareholder thus pay back the occupied capital.
2. Related revision to the Official Discussion Rules of Shareholders' Meeting is as follow:
(1) Article 33 of Chapter V Proposal of Shareholders' Meeting:
Now it is revised to: the Board of Directors should make a decision on profit distribution and
take it as proposal in annual shareholders' meeting after approval of annual report. If profit is
available, the Board of Directors didn't make any profit distribution plan or didn't distribute profit
with a lower ratio than the one the article ruled in last period, the Company should give reasons for
not being there, as well as the final usage of the undistributed profit. Independent directors and
supervisors should issue reviewed opinion.
(2) Article 83 in Chapter VII Decisions in Shareholders' Meeting
Now revised to: the following issues should be approved though special decision made by
shareholders' meeting:
(I)The Company reduces or increases registered capital
(II) Bond issuing of the Company
(III) Division, combination, dissolution and liquidation
(IV) Revision to this Article of Association
(V) Repurchase stock of the Company
(VI) The Company purchases, sell major asset or guarantee amount exceeds 30% of total
assets audited during recent period
47
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(VII) Equity stimulation plan
(VIII) Regulation or change to cash dividend ruled by Article of Association
(IX) Other issues which the law, regulation or Article of Association rules, shareholders'
meeting takes as important by ordinary decision and needed approved through special decision.
Among the perfected and revised Article of Association and Official Discussion Rules about
Shareholders, condition and procedure of related terms of profit distribution especially cash
dividend was regulative and clear. The full text of the revised Article of Association of Hefei
Meiling Inc and Official Discussion Rules of Shareholders of Hefei Meiling Inc. had been disclosed
in Juchao Website which is the information disclosure media the Company choose
(http://www.cninfo.com.cn) on 27 June 2012.
X. Plan of profit distribution or capital reserve capitalizing
The Company has no profit distribution plan for semi-annual of 2012 and implemented no
capital reserve capitalizing either.
XI. Positive retained profit accumulated at end of 2011 without cash distribution carried
out
□Applicable √Not applicable
XII. Establishment and implementation of registration mechanism for insiders
In accordance with related laws, regulations and Articles of Association and Administration
Systems of Information Disclosure, the Company had made the Registration System of Insiders of
inside Information and Confidentiality System of inside Information during 2009 and 2010. In
reporting period, the Company strictly conducted the beforehand systems, truly and completely
recorded all the insiders during various stages such as reporting, delivering, compiling, approving
and disclosing during periodical reports and significant issues before inside information went public.
Related documents recording the time when the insiders knew the information were made too for
self-check of the Company and inspection from related supervision institution. We strengthened
confidentiality of inside information, prevented illegal inside trade thus prevented insiders from
abusing or leaking inside information for inside trades. Therefore we protected interests of majority
shareholders.
In the report period, relevant staffs make no inside information for inside trading and no inside
information leaking. No particular about insiders make use of inside information for inside trading
or inside trading conduction by suggestion of the insiders that causes seriously losses in the
Company. No custody measurement and administration punishment on related staff from regulatory
authorities in aspect of inside trading involved.
XIII. Routine work of the Board of Directors in reporting period
Newspaper for disclosure
Date & session times Contents
48
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Deliberated and approved follow 3 proposals:
“ Appointment of Deputy President of the Company”,
2012-3-9 Securities Times, China
“Application of Line of Credit with 400 million ceiling for
th
The 9 Meeting of 7th Securities Journal and
Industrial and Commercial Bank of China, Hefei branch of
Session of the Board Hong Kong Commercial
the Yangtze River E-Road” and “Application of Line of
Daily
Credit with 300 million ceiling for Anhui Branch of Bank
of Communication”
2012-3-20 Deliberated and approved totally 19 proposals including:
Securities Times, China
The 10th Meeting of “Working Report of the Board for year of 2011”,
Securities Journal and
7th Session of the “Summary and Full Text of 2011 Annual Report” and
Hong Kong Commercial
Board “Final Results for year of 2011”
Daily
2012-3-30 Deliberated and approved the “proposal of implementation
Securities Times, China
The 11th Meeting of plan for regulation of internal control of the Company”
Securities Journal and
7th Session of the
Hong Kong Commercial
Board
Daily
2012-4-20 Deliberated and approved totally 4 proposals including:
Securities Times, China
The 12th Meeting of “First Quarterly Report of 2012”. “accrual of bad debt
Securities Journal and
7th Session of the provision” and “withdrawal of employee’s retirement
Hong Kong Commercial
Board welfare”
Daily
2012-5-25 Deliberated and approved 2 proposals as “temporary
《Securities Times,
The 13th Meeting of supplementation of circulating capital from part of idle
China Securities Journal
7th Session of the fund-raised” and “Convening the 1st extraordinary
and Hong Kong
Board shareholders’ general meeting of 2012”
Commercial Daily
Deliberated and approved 4 proposals as “Engagement of
2012-6-1 auditing institution for internal control of the Company”,
Securities Times, China
The 14th Meeting of “Amendment of part of clause in ‘Article of Association’”,
Securities Journal and
7th Session of the “Amendment of part of clause in ‘Discussion Rules for
Hong Kong Commercial
Board Shareholders’ General Meeting of the Company’” and
Daily
“Convening the Annual Shareholders’ General Meeting of
2011”
In reporting period, the Board of Directors held two shareholders' meetings. On Jun. 12 of
2012, 2012 the 1st extraordinary shareholders' meeting was held where Proposal of Using Partial
Idle Raised Funds for Making for Current Capital Temporarily was approved. On Jun. 26 of 2012
the 2011 annual shareholders' meeting was held where 18 proposals were approved such as 2011
Annual Work Report of Board of Directors, 2011 Annual Work Report of Board of Supervisors,
2011 Annual Report and Summary, Proposal of Revision to Partial Terms of Articles of Association,
Proposal of Revision to Partial Terms of Official Discussion Rules of Shareholders' Meeting. The
above issues were disclosed on Securities Times, China Securities Journal, Hong Kong Commercial
Daily and Juchao Website (http://www.cninfo.com.cn) are available for checking the information as
long as you type code of the Company in line of Individual Stock Check.
XIV. Financial report of the Company in reporting period has not been audited.
49
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter V. Significant Events
I. Company Governance
During the reporting period, the company is strictly in accordance with the relevant laws and
regulations, such as "Company Law", "Securities Act", "Listed Company Governance Guideline"
and "the Listing Rules of Shenzhen Stock Exchange" to establish and improve the governance of
corporation structure, to strengthen the management of information disclosure. In order to prevent
the illegal trading, it standardizes the management of insiders registration and keeps information as
secrets; To implement the work of internal control practices carefully and perfect the system of
internal controls; Improving the management of internal controls, risks and information to
standardize company's operations and heighten the levels of corporate governance. At present, the
governance system is basically sound, the operation is in the state of specification and the
corporation structure is perfect, which meet the needs of documents of listed company, released by
the China Securities Regulatory Commission.
II. Equity Incentive Plan in reporting period
The Company formulated no equity incentive plan in reporting period.
III. Deliberation of profit distribution plan for year of 2011 in reporting period
Being audited by Shine Wing CPA, individual statement of parent company realized net profit
in 2011 amounting to RMB 200,282,314.30. In accordance with relevant regulations, the individual
statement of parent company for 2011 shows cumulated retained profit as RMB 341,190,219.48 and
cumulated capital reserve as RMB 1,625,315,350.37 after withdrawal statutory surplus reserve
RMB 20,028,231.43, plus retained profit at year-begin RMB 293,529,748.86 and less distributed
profit RMB 132,593,612.25.
In accordance with relevant regulations and “Article of Association” and take shareholders’
interest and long-term demand of the Company into consideration, the Company agrees to
implement cash dividend from capital reserve as RMB 0.5 (tax included) for each 10 shares with 2
more shares increased to all shareholders base on the total share capital 636,449,338 shares dated 31
December 2011. Totally RMB 31,822,466.90 was distributed for cash dividend, shares reverted
from capital reserve amounting to 127,289,868 shares and the capital reserve use for capitalizing by
parent company -- shares premium that belongs to detail accountant item was RMB127, 289,868.
After distribution, total share capital of the Company increase from 636,449,338 shares to
763,739,206 shares, the retained profit will carry forward for distribution in later period.
The above profit distribution plan for year of 2011 and shares converted from capital reserve
have been deliberated and approved in 10th Meeting of 7th Session of the Board and Annual
Shareholders’ General Meeting of 2011 dated 20 March 2012 and 26 June 2012 respectively and
should be implemented by the Company as regulated.
50
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
IV. Material lawsuits and arbitrations in reporting period
1. No material lawsuits and arbitrations occurred in this period
2. Other lawsuits and arbitrations in reporting period
In order to safeguard the independence and integrity of "Meiling" trademark, the company
arranges and checks the permission to use the trademark before purchasing 100% of property rights
of Hefei Meiling Holding Group Co., Ltd., (hereinafter "the Meiling Group") according to the
principles of centralized management and consistent use of "Meiling" trademark. At the end of
reporting period, the progress of litigation and arbitration in which "Meiling" involves as follows:
(1)A subsidiary of Meiling Group sues Hefei Meiling Appliances Co., Ltd., to remove "the
Agreement of Use of Trademark" which is signed originally. The Meiling Group has made an
appeal of 2nd instance to Anhui Supreme People's Court. Now the case has been come up, waiting
for the result.
(2)The Meiling Group, Hefei Meiling Communications Technology Co., Ltd., and Hefei
Meiling Cabinet Appliances Co., Ltd., has applied for arbitration to Hefei arbitration committee on
the case of removing the original "the Agreement of Use of Trademark" and asking payment of
damages. At present, the case has been come up, waiting foe the result.
V. Material assets acquisition and sales as well as recapitalize in reporting period
No material assets acquisition and sales as well as enterprise combination in reporting period.
VI. Relevant events of bankruptcy reorganization
In reporting period, the Company has no relevant bankruptcy reorganization been found,
including applying for reorganization, reconciliation or bankruptcy liquidation to the Court and
accepted reorganization, reconciliation or bankruptcy liquidation by the Court as well as ruling
results by the Court during reorganization period and other material events been found.
VII. Equity of other listed company and stock jointly financial enterprise held by the
Company
(I) Security investment
□Applicable √Not applicable
(II) Equity of other listed company held by the Company
□Applicable √Not applicable
(III) Equity of non-listed financial enterprise held by the Company
√Applicable □Not applicable
Proport Changes on Accou
Shar
ion in owner’ nt
Initial Number of Book value at Gains/losses in e
equity equity in items
Name investment shares held period-end report reso
of the report for
cost (RMB) (Share (RMB) period(RMB) urce
compa period(RMB calcula
s
ny (%) ) tion
Huishang Long-t Initi
5,000,000.00 10,737,573 0.13 5,000,000.00 1,073,757.30 0.00
Bank Co., erm al
51
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Ltd. equity inve
invest stme
ment nt
Total 5,000,000.00 10,737,573 -- 5,000,000.00 1,073,757.30 0.00 -- --
VIII. Buying and selling shares of other listed company
□Applicable √Not applicable
IX. Assets transaction
(I) Assets purchased or acquired
□Applicable √Not applicable
(II) Assets sold
□Applicable √Not applicable
(III) Assets replacement
□Applicable √Not applicable
(IV) Enterprise combination
□Applicable √Not applicable
(V) Progress of the events and their influence on the Company’s operating results and
financial status in the report period after the Report on Assets Restructure or Public Notice
on Acquisition and Sales of Assets being published
□Applicable √Not applicable
X. Major Shareholders and persons acting in concert propose or implement the plan of
increased share holding in reporting period
On 16 January 2012, the Company received a "Letter" about increased share holding from
shareholder Sichuan Changhong. Based on the confidence in company's future, Sichuan Changhong
and its subsidiary Hong Kong Changhong increase the holding of 1,664,541shares through
Shenzhen Stock Exchange Trading System between December 26, 2011 and January 13, 2012,
which is 0.26% of total. Among them, Sichuan Changhong increased 1,274,000shares of A Share
through Shenzhen Stock Exchange Trading System in Jan.13, 2012, which is 0.20% of total; Hong
Kong Changhong increased 390,541shares of B Share through Shenzhen Stock Exchange Trading
System between December 26, 2011 and January 13, 2012, which is 0.06% of total.
By June 30, 2012,Sichuan Changhong and Hong Kong Changhong hold 158,328,461 shares
together, which account for 24.88% of total including Sichuan Changhong holds 137,356,942
shares of A Share, which is 21.58% of total, Hong Kong Changhong holds 20,971,519 shares of B
Share, which is 3.30% of total.
The above event has been disclose in appointed medial “Securities Times”, “China Securities
Journal”, “Hong Kong Commercial Daily” and Juchao Website (www.cninfo.com.cn) dated 17
January 2012 with announcement No.:2012-002.
XI. Significant related transactions in reporting period
(I) Related transaction related to daily operation
√Applicable □Not applicable
52
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Reasons of
Related Related major
Proportion in
Content of transaction transaction Influence of Market difference
Type of related Pricing similar Clearing form for
Related party Relationship related price amount profit of the price(RMB0’00 between
transaction principle transactions related transaction
transaction (RMB0’000, (RMB0’000, Company 0) trading price
(%)
tax excluded) tax excluded) and market
reference price
Color
masterbatch,
Sichuan Changhong Electric Parent Commodity steel plate, Marketing Spot exchange or
4,635.26 4,635.26 0.89 - - -
Co., Ltd. company purchased electric melting, price bank acceptance
resistors,
accessory etc.
Other
enterprise
control under
Commodity Marketing
Huayi Compressor Co., Ltd. the same parent Compressor 24,145.85 24,145.85 4.66 Bank acceptance - - -
purchased price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Mold Commodity Plastic products Marketing
the same parent 13,373.86 13,373.86 2.60 Bank acceptance - - -
Plastic Tech. Co., Ltd. purchased etc. price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Jijia Fine Commodity Door shell, Marketing
the same parent 9,710.39 9,710.39 1.87 Bank acceptance - - -
Co., Ltd. purchased baseboard etc. price
company and
ultimate
controller
Other
enterprise Packing case,
Sichuan Changhong Package Commodity Marketing
control under printed matter 1,454.17 1,454.17 0.28 Bank acceptance - - -
Printing Co., Ltd. purchased price
the same parent etc.
company and
53
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Precision Commodity Marketing
the same parent PCB etc. 144.38 144.38 0.03 Bank acceptance - - -
Electronics Tech. Co., Ltd. purchased price
company and
ultimate
controller
Other
enterprise
control under Printed board,
Sichuan Changhong Devices Commodity Marketing
the same parent remote control, 688.76 688.76 0.13 Bank acceptance - - -
Tech. Co., Ltd. purchased price
company and transformer etc.
ultimate
controller
Other
enterprise
control under
Sichuan Liyuan Electronic Co., Commodity Transformer, Marketing
the same parent 374.66 374.66 0.07 Bank acceptance - - -
Ltd. purchased filter etc. price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong New Commodity Marketing
the same parent Battery 33.42 33.42 0.01 Bank acceptance - - -
Energy Technology Co., Ltd. purchased price
company and
ultimate
controller
Other
enterprise
control under
Mianyang Hongrun Electronic Commodity Conductor line Marketing
the same parent 439.46 439.46 0.08 Bank acceptance - - -
Co., Ltd. purchased etc. price
company and
ultimate
controller
Guangdong Changhong Other Commodity Foam pieces Marketing
23.57 23.57 0.00 Bank acceptance - - -
Electronics Co., Ltd. enterprise purchased etc. price
54
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
control under
the same parent
company and
ultimate
controller
Other
enterprise
control under
Zhongshan Guanghong Mold Commodity Plastic pressure Marketing
the same parent 9.84 9.84 0.00 Bank acceptance - - -
Plastic Tech. Co., Ltd. purchased pieces price
company and
ultimate
controller
Other
enterprise
control under
Jingdezhen Honghua Appliance Commodity Marketing
the same parent Door seal 111.13 111.13 0.02 Bank acceptance - - -
Devices Co., Ltd. purchased price
company and
ultimate
controller
Sales of
Sichuan Changhong Electronic Parent Air-conditioner, Marketing Spot exchange,
commodity 77,224.47 77,224.47 14.54 - - -
Co., Ltd. company refrigerator price bank acceptance
Other
enterprise
control under Sales of
PT.CHANGHONG ELECTRIC Marketing
the same parent commodity Air-conditioner 3,563.76 3,563.76 0.67 Spot exchange - - -
IND price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Jijia Fine Sales of raw Steel plate, Marketing Spot exchange,
the same parent 1,304.50 1,304.50 0.25 - - -
Co., Ltd. materials color plate etc. price bank acceptance
company and
ultimate
controller
Other Transparent
Sichuan Changhong Mold Sales of raw Marketing Spot exchange,
enterprise plastic, color 2,374.22 2,374.22 0.45 - - -
Plastic Tech. Co., Ltd. materials price bank acceptance
control under masterbatch
55
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
the same parent
company and
ultimate
controller
Other
enterprise
Mianyang LJY control under Sales of Air-conditioner,
Marketing
Commerce-Trading Chain Co., the same parent commodity freezer, washing 2.85 2.85 0.00 Spot exchange - - -
price
Ltd. company and machine
ultimate
controller
Other
enterprise
control under Sales of
Sichuan Changhong Precision Marketing
the same parent commodity Air-conditioner 52.17 52.17 0.01 Spot exchange - - -
Electronics Tech. Co., Ltd. price
company and
ultimate
controller
Other
enterprise
Air-conditioner,
control under Sales of
Chongqing Hong Life refrigerator, Marketing
the same parent commodity 100.36 100.36 0.02 Spot exchange - - -
Commerce-Trading Co., Ltd. freezer, washing price
company and
machine
ultimate
controller
Other
enterprise
control under Sales of
Sichuan Hongrui Electrician Marketing
the same parent commodity Air-conditioner 1.12 1.12 0.00 Spot exchange - - -
Co., Ltd. price
company and
ultimate
controller
Other
enterprise
control under
Hong Kong (Changhong) Sales of Marketing
the same parent Air-conditioner 11.60 11.60 0.00 Spot exchange - - -
Trading Co., Ltd. commodity price
company and
ultimate
controller
56
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Other
enterprise
control under Sales of
Sichuan Changhong New Marketing
the same parent commodity Air-conditioner 0.17 0.17 0.00 Spot exchange - - -
Energy Technology Co., Ltd. price
company and
ultimate
controller
Other
enterprise
control under
Guangdong Changhong Digital Sales of Marketing
the same parent Air-conditioner 0.40 0.40 0.00 Spot exchange - - -
Technology Co., Ltd. commodity price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Minsheng Sales of Marketing
the same parent Air-conditioner 30.90 30.90 0.01 Spot exchange - - -
Logistic Co., Ltd. commodity price
company and
ultimate
controller
Other
enterprise
control under
Wandao Network Technology Sales of Marketing
the same parent Air-conditioner 77.19 77.19 0.01 Spot exchange - - -
Co., Ltd. commodity price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Gerun Sales of Marketing
the same parent Air-conditioner 8.32 8.32 0.00 Spot exchange - - -
Renewable Resources Co., Ltd. commodity price
company and
ultimate
controller
Other Air-conditioner,
LJY Chain Management Co., enterprise Sales of refrigerator, Marketing Spot exchange,
1,780.16 1,780.16 0.34 - - -
Ltd. control under commodity freezer, washing price bank acceptance
the same parent machine
57
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
company and
ultimate
controller
Other
enterprise
control under
Changhong Electric (Australia) Sales of Air-conditioner, Marketing
the same parent 1,693.62 1,693.62 0.32 Spot exchange - - -
Co., Ltd. commodity refrigerator price
company and
ultimate
controller
Other
enterprise
control under
CHANGHONG ELECTRIC Sales of Marketing
the same parent Air-conditioner 945.77 945.77 0.18 Spot exchange - - -
MIDDLE EAST FZE commodity price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Service Exp. Appliance Sales of Air-conditioner, Marketing Spot exchange,
the same parent 122.75 122.75 0.02 - - -
Service Chain Co., Ltd. commodity spare parts price bank acceptance
company and
ultimate
controller
Other
enterprise
control under
Zhongshan Guanghong Mold Sales of Marketing
the same parent Air-conditioner 15.10 15.10 0.00 Spot exchange - - -
Plastic Tech. Co., Ltd. commodity price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Mold Related party Plant, steel Marketing
the same parent 64.72 64.72 Spot exchange - - -
Plastic Tech. Co., Ltd. lease structure shed price
company and
ultimate
controller
Sichuan Changhong Jijia Fine Other Related party Plant Marketing 23.33 23.33 Spot exchange - - -
58
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Co., Ltd. enterprise lease price
control under
the same parent
company and
ultimate
controller
Other
enterprise
control under
Guangdong Changhong Related party Marketing
the same parent Office building 10.16 10.16 Spot exchange - - -
Electronics Co., Ltd. lease price
company and
ultimate
controller
Other
enterprise
control under
Guangdong Changhong Digital Related party Marketing
the same parent Office building 1.18 1.18 Spot exchange - - -
Technology Co., Ltd. lease price
company and
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Minsheng Related party Marketing
the same parent Office building 0.22 0.22 Spot exchange - - -
Logistic Co., Ltd. lease price
company and
ultimate
controller
Other
enterprise
control under
Zhongshan Guanghong Mold Related party Marketing
the same parent Office building 1.27 1.27 Spot exchange - - -
Plastic Tech. Co., Ltd. lease price
company and
ultimate
controller
Other
enterprise
Sichuan Service Exp. Appliance Related party Marketing
control under Office building 17.44 17.44 Spot exchange - - -
Service Chain Co., Ltd. lease price
the same parent
company and
59
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
ultimate
controller
Other
enterprise
control under
Sichuan Changhong Jijia Fine Related party Operational Marketing
the same parent 1.93 1.93 Spot exchange - - -
Co., Ltd. lease lease for driving price
company and
ultimate
controller
Other
enterprise
control under Operational
Sichuan Changhong Mold Related party Marketing
the same parent lease of heat 0.47 0.47 Spot exchange - - -
Plastic Tech. Co., Ltd. lease price
company and treating furnace
ultimate
controller
Other
enterprise
control under
BVCH Optronics (Sichuan) Co., Related party Marketing
the same parent Goods lift 2.46 2.46 Spot exchange - - -
Ltd. lease price
company and
ultimate
controller
Operational
Sichuan Changhong Electronic Parent Related party lease of plant, Marketing
322.91 322.91 Spot exchange - - -
Co., Ltd. company tenant warehouse and price
office room
Other
enterprise
control under Operational
Sichuan Changhong Minsheng Related party Marketing
the same parent lease of plant, 307.70 307.70 Spot exchange - - -
Logistic Co., Ltd. tenant price
company and warehouse etc.
ultimate
controller
Sichuan Changhong Electronic Parent Technology, Marketing Spot exchange,
Labor receiving 486.69 486.69 - - -
Co., Ltd. company service price bank acceptance
Other
Sichuan Hongxin Software Co., Software Marketing Bank
enterprise Labor receiving 130.00 130.00 - - -
Ltd. service price acceptance
control under
60
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
the same parent
company and
ultimate
controller
Other
enterprise
control under Maintenance,
Sichuan Service Exp. Appliance Marketing Spot exchange,
the same parent Labor receiving 4008 calling 2,793.67 2,793.67 - - -
Service Chain Co., Ltd. price bank acceptance
company and service
ultimate
controller
Other
enterprise Logistic
control under transportation,
Sichuan Changhong Minsheng Marketing Spot exchange,
the same parent Labor receiving warehousing 17,161.09 17,161.09 - - -
Logistic Co., Ltd. price bank acceptance
company and and loading &
ultimate un-loading
controller
Other
enterprise
control under Fuels and
Guangdong Changhong Water, electric, Government-se
the same parent powers 98.50 98.50 Spot exchange - - -
Electronics Co., Ltd. gas t price
company and provided
ultimate
controller
Other
enterprise
control under Fuels and
Guangdong Changhong Digital Water, electric, Government-se
the same parent powers 13.88 13.88 Spot exchange - - -
Technology Co., Ltd. gas t price
company and provided
ultimate
controller
Other
enterprise
control under Fuels and
Sichuan Changhong Minsheng Water, electric, Government-se
the same parent powers 3.15 3.15 Spot exchange - - -
Logistic Co., Ltd. gas t price
company and provided
ultimate
controller
61
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Other
enterprise
control under Fuels and
Sichuan Service Exp. Appliance Water, electric, Government-se
the same parent powers 3.05 3.05 Spot exchange - - -
Service Chain Co., Ltd. gas t price
company and provided
ultimate
controller
Other
enterprise
control under Fuels and
Zhongshan Guanghong Mold Water, electric, Government-se
the same parent powers 0.28 0.28 Spot exchange - - -
Plastic Tech. Co., Ltd. gas t price
company and provided
ultimate
controller
Fuels and
Sichuan Changhong Electronic Parent Water, electric, Government-se
powers 617.52 617.52 Spot exchange - - -
Co., Ltd. company gas t price
provided
Total -- -- 166,515.80 -- -- -- --
Details of major sold-goods return Not applicable
1. The related transactions between the Company and Sichuan Changhong as well as its subsidiary are the continuous and operational
related transactions. With the purpose of guarantee normal operation and reducing cost, the Company exercise related transaction
with Sichuan Changhong as well as its subsidiary in aspect of high-end supporting service, engineering equipment,
maintenance/spare parts, mold, lease, software service, air-conditioner sales, logistic management and logistic services. The related
transactions were organized as marketization, operating by open bidding and follow the market principles which are necessary for the
Necessity and sustainable of related transaction as well as reasons of related
routine operation of the Company.
transaction with related parties(not with other marketing dealers)
2. Compressor is the material part of refrigerators and freezers take the performance, quality, price and service transport into
comprehensive consideration, the Company choose the compressor from Huayi Compressor and its controlling shareholders in recent
years. Furthermore, subordinate subsidiary- Jiangxi Meiling Electric’s plant is close to the plant of Huayi Compressor, for
cost-saving purpose, Jiangxi Meiling Electric purchasing compressed air and rented the automatic fire protection system from Huayi
Compressor as well as receiving logistic service from Huayi.
The above daily related transactions are continuous and day-to-day related transaction. The Company has stable partnership with
those related parties due to long-term cooperation. The dealing price was market price, and dealing quantity is follow the actual
Influence on independence of listed company from related transaction amount occurring which running in a basis of fair-ness and mutual benefits. The fair-ness pricing harms no interest of the listed
company and shows no material influence on financial status and operating results of the Company in current period and later period,
shows no influence on the independence of the Company.
Dependence on related parties by Company as well as relevant solutions (If The related transaction amount takes a minor proportion in similar transactions, and the transactions are follow the market principle
applicable) of open bidding, there has no dependence on related parties concerned.
Actual implementation of those amount that predicted in this period by category Being deliberated and approved in Annual Shareholders’ General Meeting of 2011, the daily related transactions for year of 2012
for daily related transaction predicted as:
62
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
1. Commodity purchased from Sichuan Changhong and its subsidiary by the Company predicted less than RMB 710 million (tax
excluded) in 2012, actual occurring amount in reporting period was RMB 308.8777 million.
2. Commodity purchased (including compressor purchased) from Huayi Compressor and its subsidiary by the Company predicted
less than RMB 510 million (tax excluded) in 2012, actual occurring amount in reporting period was RMB 242.5698 million.
3. Sales of equipment and software to Sichuan Changhong and its subsidiary or commodity purchased from Sichuan Changhong and
its subsidiary by the Company predicted less than RMB 100 million (tax excluded) in 2012, actual occurring amount in reporting
period was RMB 2.1923 million.
4. Commodity sales and fuel and power provided to Sichuan Changhong and its subsidiary by the Company predicted less than RMB
1800 million (tax excluded) in 2012, actual occurring amount in reporting period was RMB 893.5743 million.
5. Compressed air, rented automatic fire protection system purchased from Huayi Compressor and its subsidiary by the Company
predicted less than RMB 2 million (tax excluded) in 2012, actual occurring amount in reporting period was RMB 0.
6. Leasing business from Sichuan Changhong and its subsidiary by the Company predicted less than RMB 35.8 million (tax
excluded) in 2012, actual occurring amount in reporting period was RMB 7.5398 million.
7. Management of logistic business of domestic finished products which was entrusted the Sichuan Changhong Minsheng Logistic
Co., Ltd. by the Company predicted less than RMB 387 million (tax excluded) in 2012, actual occurring amount in reporting period
was RMB 133.174 million.
8. Logistic service received from Sichuan Changhong Minsheng Logistic Co., Ltd. by the Company predicted less than RMB 13
million (tax excluded) in 2012, actual occurring amount in reporting period was RMB 4.3333 million.
9. Labor service received by the Company from Sichuan Changhong and its subsidiary by the Company predicted less than RMB
54.2 million (tax excluded) in 2012, actual occurring amount in reporting period was RMB 34.1036 million.
Decision procedures and routine operation of related transactions are comply with relevant laws, regulations and article of
Explanation on related transactions
association of the Company, no harm to the interest of the Company and minority shareholders’.
Related transactions concerned with routine operations
Selling products and providing labor service to Purchasing commodity and accepting labor service
related party from related party
Related party
Trading amount Proportion in similar Trading amount Proportion in similar
(RMB0’0000) transactions amount (%) (RMB0’0000) transactions amount (%)
Sichuan Changhong and subsidiary (excluding Huayi
89,309.43 16.81% 48,048.88 9.26%
Compressor and its subsidiary)
Huayi Compressor and its subsidiary 24,256.98 4.67%
Total 89,309.43 16.81% 72,305.86 -
Of which: in reporting period, RMB 893.0943 million was arising from related transaction by selling commodity to controlling shareholders and its subsidiary or
providing labor service.
63
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(II) Related transaction incurred by purchase or sales of assets
In reporting period, no assets purchasing and selling occurred.
(III) Significant related transaction from jointly investment outside
No major related transaction of jointly investment outside in reporting period.
(IV) Current related liabilities and debts
√Applicable □Not applicable
64
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Funds offering to listed company from related party
Funds offering to related party(RMB0’000)
(RMB0’000)
Payme
Related party Relationship Period- Period-e
Period-beg nt Interest Interest Period-beg Payment Interest Interes
Amount end Amount nd
in balance amoun income cost in balance amount income t cost
balance balance
t
Sichuan Changhong Electronic Co.,
Parent company 513.84 837.02 1350.86
Ltd.
Sichuan Changhong Electric Group
Parent company 0.00 1.05 1.05
Co., Ltd.
Other enterprise
control under the
Sichuan Changhong Minsheng
same parent 3234.78 1703.03 1531.75
Logistic Co., Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Changhong Jijia Fine Co.,
same parent 20.00 700.00 720.00
Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Changhong Mold Plastic
same parent 32.00 32.00
Tech. Co., Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Changhong Property Co.,
same parent 0.30 0.30 0.00
Ltd.
company and
ultimate controller
Other enterprise
Jingdezhen Honghua Appliance
control under the 5.00 5.00
Devices Co., Ltd.
same parent
65
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
company and
ultimate controller
Other enterprise
control under the
Sichuan Changhong Gerun
same parent 2.75 1.75 1.00
Renewable Resources Co., Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Service Exp. Appliance
same parent 0.00 416.72 416.72
Service Chain Co., Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Changhong International
same parent 0.22 0.22
Hotel Co., Ltd.
company and
ultimate controller
Other enterprise
control under the
Sichuan Jiahong Industrial Co., Ltd. same parent 0.00 1.00 1.00
company and
ultimate controller
Other enterprise
control under the
Sichuan Liyuan Electronic Co., Ltd.
same parent 0.00 0.20 0.20
of 081 Electronic Group
company and
ultimate controller
Affiliated
enterprise of
Sichuan Changhong Dongyuan Fine
controlling 0.00 34.66 34.66
Equipment Co., Ltd.
shareholders and
actual controller
Sichuan Changhe Technology Co., Affiliated
5.00 1.60 6.60
Ltd. enterprise of
66
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
controlling
shareholders and
actual controller
Total 3813.89 1992.25 1705.08 4101.06
Amount offering to controlling shareholders and its
subsidiary in reporting period (RMB0’000)
Balance of offering funds to controlling shareholders and
its subsidiary (RMB0’000)
Reasons for related liability and debts formulated
Liquidation of related liability and debts
Commitments with related liability and debts concerned
Influence on operation results and financial status of the
Company from related liability and debts
Of which: funds offering to controlling shareholder and its subsidiary by the listed company amounting to RMB 0 and balance of RMB 0.
No fund of the Company occupied by related party and no liquidation either in reporting period.
67
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
(V) Other Routine Related Transactions
The detail is in section VIII of notes of financial report.
The business dealings between company and related companies operate on general market
rules, and equal treatment to other enterprises. The price of sale and other labor services is
determined by national price; if no national price, it is determined by market price; if no market
price, it is determined by the price which is priced by both sides on the principle of actual cost and
reasonable expense. For some special services which can not be determined by the principle, both
of sides will set the price through consultation.
(VI) Other significant related transaction
No other significant related transactions occurred in reporting period.
VIII. Significant contracts and its implementation in reporting period
(I) No profits earned from trusteeship, contract and lease reached over 10% (10%
included) of total profit in this period
(II) Material guarantee contract
The Company provided no guarantees to any legal person or nature person except controlling
or wholly-owned subsidiaries in reporting period. The guarantee provided to controlling or
wholly-owned subsidiaries was for the purpose of supporting its operations with means of warranty;
meanwhile, subordinate controlling or wholly-owned subsidiaries are offered corresponding
counter-guarantee for the guarantee provided by the Company. The guarantee offered outside and
for subsidiaries till 30 June 2012 is as:
Unit: RMB0’000
Particulars about the external guarantee of the Company (barring the guarantee for controlling subsidiaries )
Date of
Relevant happening For related
Guarantee’s Guarantee Actual guarantee Guarantee Guarantee Accomplis
disclosure (date of parties or not
name limit amount type term hed or no
date /No. agreement (yes or no)
signing)
N/A - - - - - - - -
Total of external guarantee Total of actual external
- -
approved in Period(A1) guarantee in Period(A2)
Total of external guarantee Total of actual external
- -
approved at Period-end(A3) guarantee at Period-end(A4)
Guarantee for subsidiaries
Date of
Actual
Relevant happening Actual For related
Guarantee’s Guarantee guarantee Guarantee Guarantee Accomplis
disclosure (date of guarantee parties or not
name limit amount type term hed or not
date /No. agreement amount (yes or no)
used
signing)
2011-4-11
Sichuan
No.:
Chuanghong
2011-022; Jointly
Air 36,000.00 2011-11-28 8,888.00 8,887.98 6 months Yes No
2012-3-21 liability
Conditioner
No.:2012-0
Co., Ltd.
06
Zhongshan 2011-4-11
Jointly
Changhong No.:2011-0 5,000.00 2012-4-23 5,000.00 3,760.00 1yera No No
liability
Electric 22;
68
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Appliance 2012-3-21
Co., Ltd No.:
2012-006
2011-4-11
Hefei Meiling
No.:2011-0 Jointly
Nonferrous 2011-6-10 1,700.00 1,700.00 1year Yes No
22; liability
Metal 4,000.00
2012-3-21
Products Co.,
No.:
Ltd. Jointly
2012-006 2011-7-19 700.00 700.00 11months Yes No
liability
Hefei Meiling
2012-3-21
Packaging Jointly
No.: 3,000.00 - 0 0 1yera - No
Products Co., liability
2012-006
Ltd.
Meiling
Yingkaite
Household Jointly
- 400.00 2009-6-22 400.00 0 3yeras Yes No
Appliance liability
(Hefei) Co.,
Ltd.
Hefei
Yingkaite
Jointly
Electric - 200.00 2009-6-22 200.00 0 3yeras Yes No
liability
Appliance
Co., Ltd.
Total of guarantee for
Total of actual guarantee for
subsidiaries approved in 48,600.00 16,888.00
subsidiaries in Period (B2)
Period (B1)
Total of guarantee for Total of actual guarantee for
subsidiaries approved at 48,600.00 subsidiaries at Period-end 5,000.00
Period-end (B3) (B4)
Total of Company’s guarantee（namely total of the large two aforementioned）
Total of actual guarantee in
Total of guarantee approved
48,600.00 the Period 16,888.00
in the Period (A1+B1)
(A2+B2)
Total of guarantee approved
Total of actual guarantee at
at Period-end 48,600.00 5,000.00
Period-end (A4+B4)
(A3+B3)
Proportion of the actual guarantee total in Company’s net assets (A4+
1.79%
B4)
Including:
Guarantee for shareholders, actual controllers and related parties(C) 0
Debt guarantee for guarantee objects of direct/indirect asset liabilities
0
above 70% (D)
Guarantee totaled above net assets 50%(E) 0
Total of three guarantees aforementioned (C+D+E) 0
Explanations on possible affiliated redemption responsibilities for undue
-
guarantees
Explanations on external guarantee against regulated procedures -
The aforementioned warrantees are the Company’s wholly-owned or controlling subsidiaries
(proportion of shares of the above controlling subsidiary held directly/indirectly by the Company
totally reaches 100%). These companies run normally, bringing no negative influence on the
Company’s financial status. In the report period, guarantee ceiling provided to subsidiary by the
Company amounting to RMB 486 million, RMB 168.88 million was actually guarantee and actual
69
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
guarantee balance at period-end was RMB 50 million. For the abovementioned guarantee,
subordinate subsidiary Meiling Group provided ceiling guarantee RMB 6 million to Meiling
Yingkaite Appliance (Hefei) Co., Ltd. and Hefei Yingkaite Appliance Co., Ltd. with actually
guarantee of RMB 0. The guarantee was formed in history before 100% equity of Meiling Group
was transferred by agreement. The guarantee was expired till end of this report period.
(III) Trust financing
□Applicable √Not applicable
(IV) Implementation of material contracts entered into during the normal operation
□Applicable √Not applicable
IX. Explanation on corporate bonds offering
□Applicable √Not applicable
X. Implementation of commitments
(I) Commitments made by the Company or shareholders holding above 5% shares of the
Company in reporting period or extending to reporting period.
1. Commitments for Share Merge Reform
The Company implemented the Share Merge Reform on 24 August 2007, that is, the Company
took the 151,530,340 current shares before the Reform and arranged 1.5 shares per 10 shares by
valuable consideration for all current A-share holders registered before the registered date of
scheme implementation. Upon completion of the valuable consideration, the shareholding of
Meiling Electric Appliance non-current share holders got the right to come into the market.
As at end of the Period, the original non-current shareholders all have strictly fulfilled
commitments in the moratorium and other relevant commitment.
2. Commitments for transfer of air conditioner asset
On 10 December 2009, the Company entered into the Property Transaction Contract with
Sichuan Changhong and Sichuan Changhong Innovation Investment Co., Ltd. in Mianyang City
concerning the successful bidding for shareholding in Zhongshan Changhong and Changhong Air
Conditioner; at the same day, the Company received the Commitment Letter presented by the large
shareholder—Sichuan Changhong. For purpose of Meiling Electric Appliance’s development, its
independence and withdrawal from the intertype competition between the Sichaun Changhong and
the Company, Sichuan Changhong committed that:
(1) Concerning property and land in use by Changhong Air Conditioner were not in the assets
scope of the transfer, Sichaun Changhong committed that it would continue leasing to Changhong
Air Conditioner at market price and negotiate with Meiling Electric Appliance about the transfer of
partial property and land according to Changhong Air Conditioner’s operation.
(2) Upon the transfer, Sichuan Changhong committed that it would make efforts to withdraw
from new related transaction with Meiling Electric Appliance; however, as for the inevitable ones, it
committed that it would set price of related transaction in market manner to make sure the
transaction fair, just and with no harm to Meiling’s interest.
(3) For support of development of Meiling Electric Appliance and air conditioner, and upon the
70
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
transfer, Sichuan Changhong committed that it would continue authorizing free use of
trademark--‘Changhong’ in the coming three years to Changhong Air Conditioner and Zhongshan
Changhong. As the above authority due, Sichuan Changhong would negotiate with Meiling
Apparatus about the authorized use of patent“Changhong”according to Meiling Electric Appliance’s
air conditioner development.
(4) Upon the transfer, Sichuan Changhong committed that it would not enter into operation
business or activities that competed or conflicted with Meiling Electric Appliance’s current or
future business, as air conditioner or refrigerator.
Till end of the report period, relevant commitments have been implemented strictly.
Changhong air conditioner and Zhongshan Changhong entered into "the Contract of Use Right
of Trademark” and "the Supplementary Contract of Use Right of Trademark" with Sichuan
Changhong respectively. The owner---Sichuan Changhong allows Changhong air conditioner and
Zhongshan Changhong to unpaid use the registered trademark "Changhong" for long time in aspect
of air conditioner and air purification devices. According to the provision, Changhong air
conditioner and Zhongshan Changhong will use the trademark where it is registered.
3. Commitments for Reduction of and Withdrawal from Intertype Competition
Concerning the Company’s private A-share of 2010, according to relevant regulations, the
Commitment Letter of reduction of and withdrawal from intertype competition with Hefei Meiling
Co., Ltd. was presented by Sichuan Changhong with committed and guaranteed that:
(1) In addition to assistance activities required by Meiling Apparatus for its interest, Sichuan
Changhong would not take initiative in business and activities competing or conflicting with
Meiling Electric Appliance’s.
(2) The Company guaranteed that it would use the shareholders’ right legally and reasonable
without take any activities restricting or influencing Meiling Electric Appliance’s normal
operational.
(3) If Meiling Electric Appliance expanded its business scope further while the Company had
already operated the new business, the Company agreed to authorize Meiling Electric Appliance the
relevant preferential acquisition right only that the Company was still the controlling shareholder or
actual controller.
Till end of the report period, relevant commitments have been implemented strictly.
4. Sichuan Changhong’s Commitment Letter of Reduction and Standardization of
Related Transaction with the Company
Concerning the Company’s private A-share of 2010, according to relevant regulations, the
Commitment Letter of reduction of and withdrawal from intertype competition with Hefei Meiling
Co., Ltd. was presented by Sichuan Changhong with committed and guaranteed that:
(1) It would take measures to make efforts to avoid continual related transaction with Meiling
Electric Appliance, and as for the inevitable ones, signed the related connection contract legally and
set the just price respectively according to the marketi-zation principle—equity and mutual benefit,
71
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
making compensation for equal value, and current market standard.
(2) It would fulfill duties as necessary withdrawal of related directors and shareholders from
the vote and obedience to legal procedures of related transactions and duties of information
disclosure.
(3) It guaranteed that it would not harm the legal interests of Meiling Electric Appliance and
other shareholders of Meiling.
Till end of the report period, relevant commitments have been implemented strictly.
5. Relevant commitments on privately offering
(1) Commitment by the Company
Since newly shares listing, Board of the Directors made commitments as:
① Publishing regular report timely with principle of trueness, accuracy, completeness and
fairness, disclosing information that has significant effect on investors. Accepting supervision and
governance by CSRC and Shenzhen Stock Exchange;
②After information that might/probably has miss-understanding effect on stock price of the
Company appears in any public media, the Company should clear up publicly in no time;
③Directors, supervisors, senior executives and key technology staffs should listen up opinions
and critics from social public persons; make use of inside information and other dirty pool dealing
stock of the Company directly/indirectly are prohibited.
The Company guarantees that no miss-representation or significant omission carried in
documents submitted in Shenzhen Stock Exchange. During period of listing application, no
information disclosed without consent by Shenzhen Stock Exchange.
(2) Commitments by controlling shareholders
Sichuang Changhong, controlling shareholder of the Company promise restricted terms for
shares in this offering limits in 36 months.
Till end of report period, all parties all strictly implemented their commitments.
6. Commitment of long-term leasing of land and houses to Mianyang Meiling from
Changhong Minsheng Logistics Limited Liability Co., -- Subsidiary of Sichuan Changhong
For further support of the rapidly development of Mianyang Meiling, ensured that the assets’
integrity of Mianyang Meiling and the stability of land and houses used for construction from 2010
private issuance. Due to the land certificate of plants that leased by Mianyang Meiling from Sichuan
Changhong Minsheng Logistics Limited Liability Co., still in process, Minsheng Logistics
committed that: After the accomplishment of house property certificate, the Company will transfer
land use right and housing property right to Mianyang Meiling as soon as possible according to
relevant laws and regulations, and help them to handle relevant procedures if necessary.
7. Commitment from Sichuan Changhong on long-term leasing of land and houses to
Mianyang Meiling from Changhong Minsheng Logistics Limited Liability Co.,-- Subsidiary of
Sichuan Changhong
For further support of the rapidly development of Mianyang Meiling, ensured that the assets’
72
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
integrity of Mianyang Meiling and the stability of land and houses used for construction from 2010
private issuance. Due to the land certificate of plants that leased by Mianyang Meiling from
Minsheng Logistics still in process, Sichuan Changhong committed that: After the accomplishment
of house property certificate, the Company will supervise and urge Minsheng Logistics to transfer
partial land use right and housing property right to Mianyang Meiling as soon as possible according
to relevant laws and regulations.
8. Commitment from Sichuan Changhong on related transaction reduction with the
Company in aspect of houses releasing
Due to the house property certificate of plants that rented by Changhong Air Conditioner still
in process, for further support of the rapidly development of Changhong Air Conditioner, ensured
that the assets’ integrity of Changhong Air Conditioner and the stability of operation, reducing the
related transaction with the Company in aspect of house leasing, Sichuan Changhong committed
that: After the accomplishment of house property certificate, the Company will transfer land use
right and housing property right to Changhong Air Conditioner as soon as possible according to
relevant laws and regulations, and help them to handle relevant procedures if necessary.
9. Transfer of State-owned Property in Meiling Group
As the Company (B Party or Transferee) signed decimal the Property Transfer Contract with
Hefei Xingtai Holding Group Co., Ltd. (A Party or Transferor) on 25th March 2010, the Company
transferred under the agreement the 100% state-owned property in Meiling Group which is partially
striped and indebted, held by Xingtai Holding, (including“Meiling”trademark, business name,
together with 8 wholly-owned or controlling subsidiaries, excluding 1.2% stock property of Meiling
Group in the Company). Commitments relevant to the Company were as follows:
(1) There was no change in the legal subject position of the transferring enterprise. The new
transferee entity would not move out from the Hefei City within the legal duration and continue
enter into apparatus and its related industry. The new transferee entity would pay tax no less than 15
million yuan—sum of the last year within 5 years paid by Meiling Group in Hefei City.
(2) Within 5 years from the effectual day of the contract, investment newly increased in Hefei
City is no less than 100 million yuan.
(3) Within 5 years from the signing, B Party, besides the internal transfer, would not transfer
the bid.
(4) Meiling Group transferred to Hefei Xingtai Asset Management Co., Ltd. the credit in total
of 48.69 million yuan under the transfer scope held by the subsidiary (the actual sum is the one in
the audited report as ending 25th March 2010) with the new transferee entity paying off in 2 years
from the signing day (a legal valid contract is necessary).
(5) The transferee offered the post in proportion to 80% of the now on-the-job number in the
transferring enterprise and subsidiary in the transfer. Under the same condition, the existing staff
and management had the privileges to be hired and arranged. As day of the displacement is the
continuing day of labor relations, it signed the labor contract of no less than 3 years with hired
73
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
people within one month from the effecting day. It continued and handled all social insurances and
paid for the housing reserve according to relevant rules of Hefei City.
(6) The transferee inherited all assets and liabilities evaluated and confirmed, of the
transferring enterprise.
(7) The transferee continued fulfilling the agreement signed with the external parties by the
transferring enterprise.
(8) The transferee continued cooperating with the A Party to complete the strip-off of the
nontransferable equity in the transferring enterprise.
(9) The transferee had to make rational utilization of land in the transfer without claim to
change in land usage.
(10) The transferee did not dilute or weaken the trademark and business name“Meiling”,
maintain them properly and committed that Meiling production amount in Hefei was no less than
70% of the total, increase of sales amount no less than 20%, fee for its product research and
development and trademark maintenance no less than 1% of the sales sum.
Till end of the report period, relevant commitments have been implemented strictly.
10. Using part of idle funds raised to temporarily supplement liquidity commitments
made
In order to fully use the company's funds, to reduce the financial costs, to meet the needs of
business development and to keep the interests of company and all shareholders, at the premise of
ensuring the funding needs of investment project, on May 25, 2012 and June 12, the 13th Meeting
of 7th Session of Board, the 8th Meeting of 7th Session of Supervisory Board and the 1st
Temporary Conference in year 2012 adopted "On the Use of Some Idle Funds to Supply the
Working Capital Temporarily " and approved the company to use 300 million idle capital to supply
the working capital temporarily. According to the related provisions, the company made such
promise as follows:
(1) The liquidity supplemented by the part of idle funds raised temporarily is only limited to
the production and operation related to the main business;
(2) The amount of the idle funds raised for temporarily supplementing liquidity will be repaid
on time to the dedicated account of the raised funds;
(3) If the acceleration of the project construction results in earlier application of the raised
funds, the Company will repay the funds earlier t the dedicated account, thus the normal conduct of
the plan of the investment projects with the raised funds will not be impacted and the use of the
raised funds will not be changed;
(4) The company undertook that it would not be involved in securities investments or venture
above RMB 10 million and directly or indirectly in transactions of new share offerings, subscription
or stocks, derivatives and convertible bonds, and would not change the investment of the raised
funds and damage the interests of the shareholders within the twelve months after the supplement of
the liquidity with the idle funds raised.
74
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
As of the end of the reporting period, the parties are strictly fulfilling their commitments.
(II) Explanation on assets or projects that reached the original profit forecast as well as
its reasons while the reporting period still in forecast period, and there are profit forecast on
assets or projects of the Company
□Applicable √Not applicable
XI. Items of other consolidated income
Unit: RMB
Items This period Last period
1. Gains(losses) from financial assets available for
sales
Less: Income tax influences from financial assets
available for sales
Net amount reckoned into other consolidated income
in previous period but transferred into gains/losses in
current period
Subtotal
2. Shares in the other consolidated income of the
investee calculated based on equity method
Less: Income tax influences of shares in the other
consolidated income of the investee calculated based
on equity method
Net amount reckoned into other consolidated income
in previous period but transferred into gains/losses in
current period
Subtotal
3. Gains(losses) from cash flow hedge instrument
Less: Income tax influences from cash flow hedge
Net amount reckoned into other consolidated income
in previous period but transferred into gains/losses in
current period
Adjusted amount transferred to initial confirmed
amount of the arbitraged items
Subtotal
4. Differences from translating foreign currency
-696,806.42
financial statements
Less: Net amount of disposing overseas business
transferred to current gains/losses
Subtotal -696,806.42
5. Others
Less: Income tax influences by others reckoned into
other consolidated income
Net amount reckoned into other consolidated income
in previous period but transferred into gains/losses in
current period
Subtotal
Total -696,806.42
XII. Registration form of receiving research, communication and interview in the report
75
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
period
Content discussed and
Date Place Way Object
documents provided
Conference Guotai Asset Operation status of the
Telephone
2012-01-13 room of the Management Co., Company, no documents
communication
Company Ltd. required
Conference Bosera Asset Operation status of the
2012-02-06 room of the Field research Management Co., Company, no documents
Company Ltd. required
Conference Operation status of the
Founder Securities
2012-05-09 room of the Field research Company, no documents
Co., Ltd.
Company required
Conference Operation status of the
2012-05-16 room of the Field research CITIC Securities Company, no documents
Company required
Conference Operation status of the
China Galaxy
2012-05-29 room of the Field research Company, no documents
Securities
Company required
Dongxing
Conference Operation status of the
Securities,
2012-07-03 room of the Field research Company, no documents
Minsheng
Company required
Securities
XIII. Engagement and non-reappointment of CPA
On 20 March 2012 and 26 June 2012, being deliberated and approved in 10th Meeting of 7th
Session of the Board and Annual Shareholders’ General Meeting of 2011, Shine Wing CPA Co.,
Ltd. was appointed as the auditing institution of the Company for year of 2012 with one-year term
for service.
Whether the semi-annual report was audited or not
□ Yes √ No
XIV. Punishment and rectification for listed company and its directors, supervisor,
senior executives, shareholders of the Company, actual controller and purchasers
□Applicable √Not applicable
XV. Explanation on other significant events
(I) Un-lock of part of the restricted shares of privately A-share offering in 2010
On 11 January 2012, part of the restricted shares of privately A-share offering in 2010 was
un-lock, totally 7 shareholders (excluding shares purchased by controlling shareholder - Sichuan
Changhong Electronic Co., Ltd.) were un-lock in this time. Un-lock shares amounting to
93,385,200 shares, a 14.67% in total share capital of the Company.
The above event has been disclosed on appointed media “Securities Times”, “China Securities
Journal”, “Hong Kong Commercial Daily” and Juchao Website (www.cninfo.com.cn) dated 10
January 2012 with announcement No.: 2012-001.
(II) The 5th un-lock for restricted circulating shares after implementation of share-split
reform
The 5th restricted circulating shares after implementation of share-split reform was un-lock for
trading dated 30 March 2012. Totally 5 shareholders are have shares released, un-lock shares
76
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
amounting to 607,846 shares, a 0.0955% in total share capital of the Company.
The above event has been disclosed on appointed media “Securities Times”, “China Securities
Journal”, “Hong Kong Commercial Daily” and Juchao Website (www.cninfo.com.cn) dated 28
March 2012 with announcement No.: 2012-011.
(III) “Working Plan of Implementation of Regulation for Internal Control” of the
Company
The “Working Plan of Implementation of Regulation for Internal Control” for year of 2012
was deliberated and approved by 11th Meeting of 7th Session of the Board.
More details found in notice and “Working Plan of Implementation of Regulation for Internal
Control” disclosed on appointed media “Securities Times”, “China Securities Journal”, “Hong
Kong Commercial Daily” and Juchao Website (www.cninfo.com.cn) dated 31 March 2012 with
announcement No.: 2012-012.
(IV) Proposal of Appointment of auditing institution for internal control of the Company
According to the relevant requirements of China Securities Regulatory Commission on
implementing the standardized work of internal control of listed company, a listed company is
required to implement the practices of internal control fully and employ audit institutions in 2012.
Considering the credit status of SHINEWING CPA Co., Ltd., , practice experience and the
familiarity to development of company, with a view that it does a good job in auditing work and
provides company with a nice service, therefore, June 1st, 2012 and June 26, the 14th Meeting of
7th Session of Board and annual shareholders' meeting in 2011 passed "On Employing Auditing
Office of Internal Control" and agreed to employ SHINEWING CPA Co., Ltd., as auditing office
for company, the employment was for a period of one year. The independent directors announced
authorized views and independent advice in advance.
The above events have been disclosed on appointed media “Securities Times”, “China
Securities Journal”, “Hong Kong Commercial Daily” and Juchao Website (www.cninfo.com.cn)
dated 2 June 2012 and 27 June respectively with announcement No.: 2012-021 and No.:2012-026.
XVI. General situation of fund occupied by controlling shareholder and its subsidiaries
as well as independent opinions issued by Independent Director on fund occupation by
controlling shareholder and other related parties in reporting period and on guarantees:
(I) The first largest shareholder, actual controller and its subsidiaries occupied no fund
of the Company.
(II) In accordance with “Notice Concerning Some Issues on Regulating the Funds
Contact between Listed Companies and Related Parties and Listed Companies’ Provision of
Guaranty to Other Parties” (ZJFNo: [2003] 56), up to this reporting period, the Company did
not offered guarantee to related parties and no guarantee events occurred in previous and last
through this period.
(III) Specific statement and independent opinions from independent directors on
accumulated and current capital occupation and external guarantee of related parties
77
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
According to relevant regulations of Notice Concerning Some Issues on Regulating the Funds
Contact between Listed Companies and Associated Parties and Listed Companies’ Provision of
Guaranty to Other Parties (ZJF[2003] No. 56) and Notice on Regulating the External Guarantee of
Listed Company (ZJF[2005] No.120 (hereinafter refer to as Notice)), independent directors of the
Company, with the attitude of preciseness, seeking truth from facts, carefulness and
responsible-ness, we carefully checked the fund occupation by controlling shareholders and its
related parties as well as external guarantee of the Company in first half year of 2012, and made
explanation and independent opinions as:
In the report period, RMB 50 million (guarantee offered to wholly-owned subsidiary
Zhongshan Changhong Electrics Co., Ltd.) was provided as external guarantee from the Company
and its subordinated company, account 1.79% of net assets of the Company audited recently. The
Company and subordinate controlling subsidiary provided guarantee RMB 0 for stock jointly
subsidiaries; no overdue external guarantees and guarantee offered outside occurred from the
Company and its controlling subsidiaries.
Ended as 30 June 2012, there was no non-operating capital occupation of controlling
shareholders and related parties. In the report period, controlling shareholders and other related
parties of the Company did not non-operationally occupy the funds of the Company, there was
either no directly or indirectly providing capital to controlling shareholders and other related parties
from the Company.
We thought that, the Company strictly complied with the regulations and requirements of
Notice, standardized the capital intercourse between the Company and controlling shareholders and
other related parties, and regulated the external guarantee which strictly accorded with relevant
rules and system, without any violating regulations, and strictly controlled and prevented operation
risk to maintain interests of all shareholders and the Company. In the Report period, the guarantee
offered to subordinate wholly-owned company or controlling subordinate company from the
Company was the demand of operation and reasonable capital use, whose decision procedure was
legal and reasonable, without any hurts for the interests of the Company and shareholders.
Independent Directors: Wang Xingzhong, Song Baozeng, Liu Youpeng and Zhang Shidi
XVII. Index for information disclosure
Name and page of publishing Date of Internet website and searching
Event
press disclosed route
Notice of Un-lock of Securities Times, China
Restricted Shares Offering Securities Journal and Hong 2012-1-10 http://www.cninfo.com.cn
Privately Kong Commercial Daily
Notice of Increase of Shares
Securities Times, China
held by Controlling
Securities Journal and Hong 2012-1-17 http://www.cninfo.com.cn
Shareholders of Hefei Meiling
Kong Commercial Daily
Co., Ltd.
Securities Times, China
Annual Performance Forecast
Securities Journal and Hong 2012-1-31 http://www.cninfo.com.cn
for year of 2011
Kong Commercial Daily
Notice of Changing the Securities Times, China 2012-3-7 http://www.cninfo.com.cn
78
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Disclosure Date for Annual Securities Journal and Hong
Report 2011 Kong Commercial Daily
Resolution Notice of 9th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily
Independent Opinions on 2012-3-10
Appointment of Deputy
- http://www.cninfo.com.cn
President from Independent
Directors
Resolution Notice of 10th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily
Resolution Notice of 6th Securities Times, China
Meeting of 7th Session of Securities Journal and Hong http://www.cninfo.com.cn
Supervisory Committee Kong Commercial Daily
Securities Times, China
Annual Repot of 2011 and its
Securities Journal and Hong http://www.cninfo.com.cn
Summary
Kong Commercial Daily
Notice of Prediction on Securities Times, China
Routine Related Transaction Securities Journal and Hong http://www.cninfo.com.cn
for year of 2012 Kong Commercial Daily
Notice of Guarantee Provided
Securities Times, China
to Subordinate wholly-owned
Securities Journal and Hong http://www.cninfo.com.cn
or Controlling subsidiary for
Kong Commercial Daily
year of 2012
Annual Report of 2011 - http://www.cninfo.com.cn
Annual Auditing Report of
- http://www.cninfo.com.cn
2011
Self-Assessment Report of
Internal Control for year of - http://www.cninfo.com.cn
2011 from the Board
Debriefing of Independent 2012-3-21
- http://www.cninfo.com.cn
Directors for year of 2011
Independent Opinions on
Guarantee Provided to
Subordinate wholly-owned or
- http://www.cninfo.com.cn
Controlling subsidiary for year
of 2012 by Independent
Director
Independent Opinions on
Relevant Events of 10th
Meeting of 7th Session of the - http://www.cninfo.com.cn
Board by Independent
Director
Independent Opinions on
Prediction of Routine Related
- http://www.cninfo.com.cn
Transaction for year of 2012
by Independent Director
Prior Approval Opinion on
Prediction of Routine Related
- http://www.cninfo.com.cn
Transaction for year of 2012
by Independent Director
Independent Opinions on
Operation of the Company for
- http://www.cninfo.com.cn
year of 2011 by Supervisory
Committee
79
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Independent Opinions on
Self-Assessment Report of
- http://www.cninfo.com.cn
Internal Control by
Supervisory Committee
Specific Explanation on Funds
Occupied by Controlling
Shareholders and Other - http://www.cninfo.com.cn
Related Parties for year of
2011
Verification Report of Savings
and Application for - http://www.cninfo.com.cn
Fund-Raised
Approval Report of Internal
- http://www.cninfo.com.cn
Control
Inspection Opinion on
“Self-Assessment Report of
Internal Control of Hefei - http://www.cninfo.com.cn
Meiling Co., Ltd.” by China
Merchants Securities Co., Ltd.
Specific Inspection Report on
Savings and Application for
- http://www.cninfo.com.cn
Fund-Raised by China
Merchants Securities Co., Ltd.
Training Management
Mechanism for Directors,
- http://www.cninfo.com.cn
Supervisors and Senior
Executives (March of 2012)
Discussion Rules for President
- http://www.cninfo.com.cn
(March of 2012)
Securities Times, China
Notice of Un-lock for Shares Securities Journal and Hong 2012-3-29 http://www.cninfo.com.cn
Kong Commercial Daily
Resolution Notice of 11th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily
2012-3-31
Implementation Plan of
Regulating Internal Control - http://www.cninfo.com.cn
Mechanism
Resolution Notice of 12th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily
Resolution Notice of 7h Securities Times, China
Meeting of 7th Session of Securities Journal and Hong http://www.cninfo.com.cn
Supervisory Committee Kong Commercial Daily 2012-4-21
Securities Times, China
Text of First Quarterly Report
Securities Journal and Hong http://www.cninfo.com.cn
of 2012
Kong Commercial Daily
Full-Text of First Quarterly
- http://www.cninfo.com.cn
Report of 2012
Securities Times, China
Notice of fund-raised Back Securities Journal and Hong 2012-5-23 http://www.cninfo.com.cn
Kong Commercial Daily
Resolution Notice of 13th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily 2012-5-26
Resolution Notice of 8th Securities Times, China
http://www.cninfo.com.cn
Meeting of 7th Session of Securities Journal and Hong
80
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Supervisory Committee Kong Commercial Daily
Notice of Temporary Current Securities Times, China
Capital Supplementation by Securities Journal and Hong http://www.cninfo.com.cn
Idle Fund-Raised Kong Commercial Daily
Notice of Convening First Securities Times, China
Extraordinary Shareholders’ Securities Journal and Hong http://www.cninfo.com.cn
General Meeting of 2012 Kong Commercial Daily
Independent Opinions on
Temporary Current Capital
Supplementation by Idle - http://www.cninfo.com.cn
Fund-Raised of the Company
by Independent Directors
Sponsor Opinions on
Temporary Current Capital
Supplementation by Idle
- http://www.cninfo.com.cn
Fund-Raised of the Company
by China Merchants Securities
Co., Ltd.
Resolution Notice of 14th Securities Times, China
Meeting of 7th Session of the Securities Journal and Hong http://www.cninfo.com.cn
Board Kong Commercial Daily
Notice of Convening Annual Securities Times, China
Shareholders’ General Securities Journal and Hong http://www.cninfo.com.cn
2012-6-2
Meeting of 2011 Kong Commercial Daily
Independent Opinions on
Appointment of Auditing
- http://www.cninfo.com.cn
Institution for Internal Control
by Independent Directors
Change of the Date for
Securities Times, China
Opening Annual
Securities Journal and Hong http://www.cninfo.com.cn
Shareholders’ General
Kong Commercial Daily
Meeting of 2011
2012-6-5
Notice of Convening First
Extraordinary Shareholders’
- http://www.cninfo.com.cn
General Meeting of 2012
(Changing opening date)
Notice of Convening First Securities Times, China
Extraordinary Shareholders’ Securities Journal and Hong 2012-6-7 http://www.cninfo.com.cn
General Meeting of 2012 Kong Commercial Daily
Resolution Notice of First Securities Times, China
Extraordinary Shareholders’ Securities Journal and Hong http://www.cninfo.com.cn
General Meeting of 2012 Kong Commercial Daily
2012-6-13
Attorney Opinions for First
Extraordinary Shareholders’ - http://www.cninfo.com.cn
General Meeting of 2012
Resolution Notice of Annual Securities Times, China
Shareholders’ General Securities Journal and Hong http://www.cninfo.com.cn
Meeting of 2011 Kong Commercial Daily
Attorney Opinions for Annual
Shareholders’ General - http://www.cninfo.com.cn
Meeting of 2011 2012-6-27
Article of Association (June of
- http://www.cninfo.com.cn
2012)
Discussion Rules for
Shareholders’ General - http://www.cninfo.com.cn
Meeting (June of 2012)
81
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter VIII Financial Report (Un-audited)
1. Consolidated Balance Sheet
Prepared by Hefei Meiling Co., Ltd. 2012-6-30 Unit: RMB
Items Note Balance at period-end Balance at period-begin
Current assets:
Monetary funds 1,166,845,074.91 1,401,674,679.41
Settlement provisions
Capital lent
Transaction finance asset
Notes receivable 2,557,190,766.71 1,523,729,827.01
Accounts receivable 1,001,666,184.42 571,218,022.8
Accounts paid in advance 163,665,256.51 237,494,745.03
Insurance receivable
Reinsurance receivables
Contract reserve of
reinsurance receivable
Interest receivable
Dividend receivable
Other receivables 11,131,811.36 41,508,227.47
Purchase restituted finance
asset
Inventories 1,470,455,732.97 1,860,605,286.96
Non-current asset due
within one year
Other current assets
Total current assets 6,370,954,826.88 5,636,230,788.68
Non-current assets:
Granted loans and
advances
Finance asset available for
sales
Held-to-maturity
investment
Long-term account
receivable
Long-term equity
36,097,665.23 36,910,458.62
investment
Investment real estate 16,914,250.88 17,318,541.96
Fixed assets 905,837,429.28 935,910,604.45
Construction in progress 285,537,614.98 204,053,321.44
Engineering material
Disposal of fixed asset
Productive biological asset
Oil and gas asset
Intangible assets 632,316,788.17 648,660,218.36
82
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Expense on Research and
31,227,668.22 25,167,492.74
Development
Goodwill 5,529,842.09 5,529,842.09
Long-term expenses to be
apportioned
Deferred income tax asset 110,745,934.9 92,782,352.57
Other non-current asset
Total non-current asset 2,024,207,193.75 1,966,332,832.23
Total assets 8,395,162,020.63 7,602,563,620.91
Current liabilities:
Short-term loans 243,089,994.43 144,000,000
Loan from central bank
Absorbing deposit and
interbank deposit
Capital borrowed
Transaction financial
liabilities
Notes payable 1,292,889,724.51 1,191,929,934.59
Accounts payable 2,005,315,350.75 1,598,851,420.62
Accounts received in
434,002,521.83 703,404,091.67
advance
Selling financial asset of
repurchase
Commission charge and
commission payable
Wage payable 82,944,903.56 109,562,805.25
Taxes payable 131,041,553.42 73,939,903.98
Interest payable
Dividend payable 1,503,556.82 1,524,379.01
Other accounts payable 799,045,107.44 518,444,925.03
Reinsurance payables
Insurance contract reserve
Security trading of agency
Security sales of agency
Non-current liabilities due
3,405,507.92 2,452,094.16
within 1 year
Other current liabilities
Total current liabilities 4,993,238,220.68 4,344,109,554.31
Non-current liabilities:
Long-term loans 11,114,600 12,705,500
Bonds payable
Long-term account payable
Special accounts payable 17,837,121.06 18,494,978.8
Projected liabilities 351,837,172.76 315,699,502.43
Deferred income tax
liabilities
Other non-current
56,088,625.21 57,318,443.08
liabilities
Total non-current liabilities 436,877,519.03 404,218,424.31
83
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Total liabilities 5,430,115,739.71 4,748,327,978.62
Owner’s equity (or
shareholders’ equity):
Paid-up capital (or share
636,449,338 636,449,338
capital)
Capital public reserve 1,609,999,547.27 1,609,999,547.27
Less: Inventory shares
Reasonable reserve
Surplus public reserve 299,625,924.94 299,625,924.94
Provision of general risk
Retained profit 361,598,714.44 250,743,672.24
Balance difference of
foreign currency ‐919,190.86 ‐501,107.01
translation
Total owner’s equity
attributable to parent 2,906,754,333.79 2,796,317,375.44
company
Minority interests 58,291,947.13 57,918,266.85
Total owner’s equity(or
2,965,046,280.92 2,854,235,642.29
shareholders’ equity)
Total liabilities and
owner’s equity(or 8,395,162,020.63 7,602,563,620.91
shareholders’ equity)
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
2. Balance Sheet of parent company
Prepared by Hefei Meiling Co., Ltd. 2012-6-30 Unit: RMB
Item Note Balance at period-end Balance at period-begin
Current assets:
Monetary funds 789,679,272.06 1,045,235,918.61
Transaction finance asset
Notes receivable 2,007,376,164.92 1,338,813,802.92
Accounts receivable 801,913,225.29 402,230,488.74
Accounts paid in advance 426,965,524.32 253,040,962.58
Interest receivable
Dividend receivable
Other receivables 46,079,466.31 48,509,875.77
Inventories 519,820,348.49 990,284,586.85
Non-current asset due
within one year
Other current assets
Total current assets 4,591,834,001.39 4,078,115,635.47
Non-current assets:
Finance asset available for
sales
Held-to-maturity
investment
84
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Long-term account
receivable
Long-term equity
841,598,182 841,422,384.33
investment
Investment real estate 13,464,514.32 13,701,458.68
Fixed assets 656,673,647.54 687,515,150.24
Construction in progress 232,165,273.45 191,737,347.16
Engineering material
Disposal of fixed asset
Productive biological asset
Oil and gas asset
Intangible assets 488,782,952.39 501,028,725.8
Expense on Research and
Development
Goodwill
Long-term expenses to be
apportioned
Deferred income tax asset 70,328,041.87 69,532,232.71
Other non-current asset
Total non-current asset 2,303,012,611.57 2,304,937,298.92
Total assets 6,894,846,612.96 6,383,052,934.39
Current liabilities:
Short-term loans 228,457,477.17 120,000,000
Transaction financial
liabilities
Notes payable 988,088,936.2 858,879,727.69
Accounts payable 1,397,797,512.01 1,271,155,333.03
Accounts received in
192,999,984.71 277,848,104.26
advance
Wage payable 59,743,399.73 80,821,797.09
Taxes payable 78,599,982.41 81,559,342.02
Interest payable
Dividend payable 1,503,556.82 1,524,379.01
Other accounts payable 512,039,852.44 400,789,644.51
Non-current liabilities due
3,405,507.92 2,452,094.16
within 1 year
Other current liabilities
Total current liabilities 3,462,636,209.41 3,095,030,421.77
Non-current liabilities:
Long-term loans 11,114,600 12,705,500
Bonds payable
Long-term account payable
Special accounts payable
Projected liabilities 351,837,172.76 315,699,502.43
Deferred income tax
liabilities
Other non-current
56,025,025.21 57,254,843.08
liabilities
Total non-current liabilities 418,976,797.97 385,659,845.51
85
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Total liabilities 3,881,613,007.38 3,480,690,267.28
Owner’s equity (or
shareholders’ equity):
Paid-up capital (or share
636,449,338 636,449,338
capital)
Capital public reserve 1,625,315,350.37 1,625,315,350.37
Less: Inventory shares
Reasonable reserve
Surplus public reserve 299,407,759.26 299,407,759.26
Retained profit 452,061,157.95 341,190,219.48
Balance difference of
foreign currency
translation
Total owner’s equity(or
3,013,233,605.58 2,902,362,667.11
shareholders’ equity)
Total liabilities and
owner’s equity(or 6,894,846,612.96 6,383,052,934.39
shareholders’ equity)
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
3. Consolidated Profit Statement
Prepared by Hefei Meiling Co., Ltd. January- June 2012 Unit: RMB
Item Note Amount in this period Amount in last period
I. Total operating income 5,312,610,523.12 5,475,018,688.64
Including: Operating
5,312,610,523.12 5,475,018,688.64
income
Interest income
Insurance gained
Commission charge and
commission income
II. Total operating cost 5,186,451,911.60 5,453,286,578.02
Including: Operating cost 4,043,977,198.26 4,301,456,048.5
Interest expense
Commission charge and
commission expense
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal
of insurance contract
reserve
Bonus expense of
guarantee slip
Reinsurance expense
Operating tax and extras 43,172,959.76 19,453,852.82
Sales expenses 937,857,498.97 980,975,553.78
Administration expenses 158,911,541.76 143,544,164.22
86
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Financial expenses ‐34,586,978.46 ‐15,240,641.58
Losses of devaluation of
37,119,691.31 23,097,600.28
asset
Add: Changing income of
fair value(Loss is listed
with “-”)
Investment income (Loss is
260,963.91 332,396.24
listed with “-”)
Including: Investment
income on affiliated ‐812,793.39 ‐136,457.31
company and joint venture
Exchange income (Loss is
listed with “-”)
III. Operating profit
126,419,575.43 22,064,506.86
(Loss is listed with “-”)
Add: Non-operating
4,579,649.44 119,542,650.05
income
Less: Non-operating
5,625,818.8 2,143,328.48
expense
Including: Disposal loss of
5,333,936.81 1,884,529.38
non-current asset
IV. Total Profit (Loss is
125,373,406.07 139,463,828.43
listed with “-”)
Less: Income tax expense 13,865,961.02 18,135,891.78
V. Net profit (Net loss is
111,507,445.05 121,327,936.65
listed with “-”)
Including: net profit
realized before
consolidation by mergered
party
Net profit attributable to
110,855,042.2 126,157,996.21
owner’s of parent company
Minority shareholders’
652,402.85 ‐4,830,059.56
gains and losses
VI. Earnings per share -- --
i. Basic earnings per share 0.1742 0.2379
ii. Diluted earnings per
0.1742 0.2379
share
VII. Other consolidated
‐696,806.42
income
VIII. Total comprehensive
110,810,638.63 121,327,936.65
income
Total consolidated income
attributable to owners of 110,436,958.35 126,157,996.21
parent company
Total consolidated income
attributable to minority 373,680.28 ‐4,830,059.56
shareholders
The merger realized net profit RMB 0.00 before consolidation during enterprises consolidation
87
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
under a same control.
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
4. Profit Statement of parent company
Prepared by Hefei Meiling Co., Ltd. January- June 2012 Unit: RMB
Item Note Amount in this period Amount in last period
I. Operating income 3,621,039,142.64 4,206,483,990.92
Less: operating cost 3,070,016,853.33 3,304,331,363.06
Operating tax and extras 31,914,753.63 17,493,568.32
Sales expenses 361,043,008.41 656,253,893.85
Administration expenses 81,986,923.62 84,083,002.38
Financial expenses ‐33,719,408.35 ‐18,725,111.31
Losses of devaluation of
‐24,334,130.41 12,483,061.95
asset
Add: Changing income of
fair value(Loss is listed
with “-”)
Investment income (Loss is
1,249,554.97 164,270.87
listed with “-”)
Including: Investment
income on affiliated 175,797.67 ‐37,579.41
company and joint venture
II. Operating profit (Loss
135,380,697.38 150,728,483.54
is listed with “-”)
Add: Non-operating
2,906,535.04 2,152,358
income
Less: Non-operating
5,321,936.63 1,880,830.05
expense
Including: Disposal loss of
5,321,936.63 1,877,046.1
non-current asset
III. Total Profit (Loss is
132,965,295.79 151,000,011.49
listed with “-”)
Less: Income tax expense 22,094,357.32 24,213,873.34
IV. Net profit (Net loss is
110,870,938.47 126,786,138.15
listed with “-”)
V. Earnings per share -- --
i. Basic earnings per share 0.1742 0.2391
ii. Diluted earnings per
0.1742 0.2391
share
VI. Other consolidated
income
VII. Total comprehensive
110,870,938.47 126,786,138.15
income
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
88
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
5. Consolidated Cash Flow Statement
Prepared by Hefei Meiling Co., Ltd. January- June 2012 Unit: RMB
Item Amount in this period Amount in last period
I. Cash flows arising from
operating activities:
Cash received from selling
commodities and providing 2,611,057,053.96 2,261,186,763.21
labor services
Net increase of customer
deposit and interbank deposit
Net increase of loan
from central bank
Net increase of capital
borrowed from other financial
institution
Cash received from original
insurance contract fee
Net cash received from
reinsurance business
Net increase of insured
savings and investment
Net increase of disposal
of transaction financial asset
Cash received from interest,
commission charge and
commission
Net increase of capital
borrowed
Net increase of returned
business capital
Write-back of tax received 44,962,884.98 25,730,915.85
Other cash received
concerning operating 12,793,275.47 154,847,635.85
activities
Subtotal of cash inflow
arising from operating 2,668,813,214.41 2,441,765,314.91
activities
Cash paid for purchasing
commodities and receiving 2,064,859,020.49 2,108,299,566.88
labor service
Net increase of customer
loans and advances
Net increase of deposits
in central bank and interbank
Cash paid for original
insurance contract
compensation
Cash paid for interest,
commission charge and
89
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
commission
Cash paid for bonus of
guarantee slip
Cash paid to/for staff and
324,087,053.68 307,943,256.24
workers
Taxes paid 268,142,290.34 156,316,882.18
Other cash paid concerning
272,269,140.43 413,539,305.42
operating activities
Subtotal of cash outflow
arising from operating 2,929,357,504.94 2,986,099,010.72
activities
Net cash flows arising from
‐260,544,290.53 ‐544,333,695.81
operating activities
II. Cash flows arising from
investing activities:
Cash received from
1,000,000
recovering investment
Cash received from
1,073,757.3 1,533,663
investment income
Net cash received from
disposal of fixed, intangible 762,052.14 71,162,183.34
and other long-term assets
Net cash received from
disposal of subsidiaries and
other units
Other cash received
concerning investing 6,171,203.13 7,880,762.49
activities
Subtotal of cash inflow from
8,007,012.57 81,576,608.83
investing activities
Cash paid for purchasing
fixed, intangible and other 81,482,550.21 57,692,391.87
long-term assets
Cash paid for investment ‐22,009,000
Net increase of mortgaged
loans
Net cash received from
978,687.97
subsidiaries and other units
Other cash paid concerning
investing activities
Subtotal of cash outflow from
81,482,550.21 36,662,079.84
investing activities
Net cash flows arising from
‐73,475,537.64 44,914,528.99
investing activities
III. Cash flows arising from
financing activities
Cash received from absorbing
35,966,000
investment
Including: Cash received
90
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
from absorbing minority
shareholders’ investment by
subsidiaries
Cash received from loans 132,587,439.8 145,961,241.63
Cash received from issuing
bonds
Other cash received
concerning financing
activities
Subtotal of cash inflow from
132,587,439.8 181,927,241.63
financing activities
Cash paid for settling debts 34,214,668.71 187,548,951.8
Cash paid for dividend and
profit distributing or interest 4,147,746.45 5,594,190.83
paying
Including: Dividend and
profit of minority shareholder
paid by subsidiaries
Other cash paid concerning
financing activities
Subtotal of cash outflow from
38,362,415.16 193,143,142.63
financing activities
Net cash flows arising from
94,225,024.64 ‐11,215,901
financing activities
IV. Influence on cash and
cash equivalents due to 4,965,199.03 3,651,667.68
fluctuation in exchange rate
V. Net increase of cash and
‐234,829,604.5 ‐506,983,400.14
cash equivalents
Add: Balance of cash and
cash equivalents at the period 1,401,674,679.41 1,986,440,504.29
-begin
VI. Balance of cash and cash
1,166,845,074.91 1,479,457,104.15
equivalents at the period -end
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
6. Cash Flow Statement of parent company
Prepared by Hefei Meiling Co., Ltd. January- June 2012 Unit: RMB
Item Amount in this period Amount in last period
I. Cash flows arising from
operating activities:
Cash received from selling
commodities and providing 2,017,909,658.46 1,511,861,481.27
labor services
Write-back of tax received 13,354,107.09 6,106,556.57
Other cash received
8,000,726.82 4,563,090.33
concerning operating
91
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
activities
Subtotal of cash inflow
arising from operating 2,039,264,492.37 1,522,531,128.17
activities
Cash paid for purchasing
commodities and receiving 1,925,474,277.93 1,423,412,655.93
labor service
Cash paid to/for staff and
143,015,542.21 179,579,555.72
workers
Taxes paid 190,639,645.56 134,642,332.56
Other cash paid concerning
94,250,858.05 283,785,138.2
operating activities
Subtotal of cash outflow
arising from operating 2,353,380,323.75 2,021,419,682.41
activities
Net cash flows arising from
-314,115,831.38 -498,888,554.24
operating activities
II. Cash flows arising from
investing activities:
Cash received from
1,000,000
recovering investment
Cash received from
1,073,757.3 1,533,663
investment income
Net cash received from
disposal of fixed, intangible 688,667.35 1,162,183.34
and other long-term assets
Net cash received from
disposal of subsidiaries and
other units
Other cash received
concerning investing 4,354,922.44 9,051,682.9
activities
Subtotal of cash inflow from
6,117,347.09 12,747,529.24
investing activities
Cash paid for purchasing
fixed, intangible and other 45,474,500.69 49,830,507.22
long-term assets
Cash paid for investment 60,000,000
Net cash received from
subsidiaries and other units
Other cash paid concerning
37,000,000
investing activities
Subtotal of cash outflow from
45,474,500.69 146,830,507.22
investing activities
Net cash flows arising from
-39,357,153.6 -134,082,977.98
investing activities
III. Cash flows arising from
financing activities
Cash received from absorbing
92
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
investment
Cash received from loans 108,457,477.17 120,000,000
Other cash received
concerning financing 39,000,000
activities
Subtotal of cash inflow from
108,457,477.17 159,000,000
financing activities
Cash paid for settling debts 640,000 169,500,000
Cash paid for dividend and
profit distributing or interest 3,398,002.7 4,203,617.65
paying
Other cash paid concerning
10,000,000 91,999,750.2
financing activities
Subtotal of cash outflow from
14,038,002.7 265,703,367.85
financing activities
Net cash flows arising from
94,419,474.47 -106,703,367.85
financing activities
IV. Influence on cash and
cash equivalents due to 3,496,863.96 3,300,748.74
fluctuation in exchange rate
V. Net increase of cash and
-255,556,646.55 -736,374,151.33
cash equivalents
Add: Balance of cash and
cash equivalents at the period 1,045,235,918.61 1,798,742,365.37
-begin
VI. Balance of cash and cash
789,679,272.06 1,062,368,214.04
equivalents at the period -end
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
93
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
7. Consolidated Statement on Changes of Owners' Equity
Amount in this period
Unit: RMB
Amount in this period
Owners' equity attributable to the parent company
Item Less: Minority’s Total owners’
Paid-up General
Treas Reasonable Surplus equity equity
capital (Share Capital reserves risk Retained profit Others
ury reserve reserves
capital) provision
Stock
I. Balance at the end of last
636,449,338 1,609,999,547.27 299,625,924.94 250,743,672.24 ‐501,107.01 57,918,266.85 2,854,235,642.29
year
Add: Changes of
accounting policy
Error correction of the last
period
Others
II. Balance at the
636,449,338 1,609,999,547.27 299,625,924.94 250,743,672.24 ‐501,107.01 57,918,266.85 2,854,235,642.29
beginning of this year
III. Increase/ Decrease in
this year (Decrease is listed 110,855,042.2 ‐418,083.85 373,680.28 110,810,638.63
with'"-")
(i) Net profit 110,855,042.2 652,402.85 111,507,445.05
(ii) Other consolidated
‐418,083.85 ‐278,722.57 ‐696,806.42
income
Subtotal of (i)and (ii) 110,855,042.2 373,680.28 111,228,722.48
(III) Owners' devoted and
0 0 0 0 0 0 0 0 0 0
decreased capital
1. Owners' devoted capital
2. Amount calculated into
owners' equity paid in
shares
3. Others
(IV)Profit distribution 0 0 0 0 0 0 0 0 0 0
94
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
1. Withdrawal of surplus
reserves
2. Withdrawal of general
risk provisions
3. Distribution for owners
(shareholders)
4. Others
(V) Carrying forward
0 0 0 0 0 0 0 0 0 0
internal owners' equity
1. Capital reserves
conversed to capital (share
capital)
2. Surplus reserves
conversed to capital (share
capital)
3. Remedying loss with
surplus reserve
4. Others
(VI) Reasonable reserve
1. Withdrawal in this
period
2. Usage in this period
(VII) Other
IV. Balance at the end of
636,449,338 1,609,999,547.27 299,625,924.94 361,598,714.44 ‐919,190.86 58,291,947.13 2,965,046,280.92
the report period
Amount in last period
Unit: RMB
Amount in last period
Owners' equity attributable to the parent company
Item Less: General Minority’s Total owners’
Paid-up
Treas Reasonable Surplus risk equity equity
capital (Share Capital reserves Retained profit Others
ury reserve reserves provisio
capital)
Stock n
95
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
I. Balance at the end of last
530,374,449 1,610,571,447.17 279,597,693.51 296,750,782.08 28,895,887.29 2,746,190,259.05
year
Add: retroactive
adjustment arising from
enterprise consolidation
under the same control
Add: Changes of
accounting policy
Error correction of the last
period
Others
II. Balance at the
530,374,449 1,610,571,447.17 279,597,693.51 296,750,782.08 28,895,887.29 2,746,190,259.05
beginning of this year
III. Increase/ Decrease in
this year (Decrease is listed 106,074,889 -571,899.9 20,028,231.43 -46,007,109.84 -501,107.01 29,022,379.56 108,045,383.24
with'"-")
-17,577,855.9
(i) Net profit 106,614,733.84 89,036,877.93
1
(ii) Other consolidated
-501,107.01 -334,071.34 -835,178.35
income
-17,911,927.2
Subtotal of (i)and (ii) 106,614,733.84 -501,107.01 88,201,699.58
5
(III) Owners' devoted and
106,074,889 -571,899.9 0 0 0 0 0 0 46,934,306.81 152,437,295.91
decreased capital
1. Owners' devoted capital 106,074,889 46,934,306.81 153,009,195.81
2. Amount calculated into
owners' equity paid in
shares
3. Others -571,899.9 -571,899.9
(IV)Profit distribution 0 0 0 0 20,028,231.43 0 -152,621,843.68 0 0 -132,593,612.25
1. Withdrawal of surplus
20,028,231.43 -20,028,231.43
reserves
2. Withdrawal of general
risk provisions
96
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
3. Distribution for owners
-132,593,612.25 -132,593,612.25
(shareholders)
4. Others
(V) Carrying forward
0 0 0 0 0 0 0 0 0 0
internal owners' equity
1. Capital reserves
conversed to capital (share
capital)
2. Surplus reserves
conversed to capital (share
capital)
3. Remedying loss with
surplus reserve
4. Others
(VI) Reasonable reserve
1.Withdrawal in this period
2.Usage in this period
(VII) Other
IV. Balance at the end of
636,449,338 1,609,999,547.27 299,625,924.94 250,743,672.24 -501,107.01 57,918,266.85 2,854,235,642.29
the report period
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
8. Statement on Changes of Owners' Equity of Parent Company
Amount in this period Unit: RMB
Amount in this period
Item Paid-up capital (Share Less: Treasury Reasonable Surplus General Total owners’
Capital reserves Retained profit
capital) Stock reserve reserves risk reserve equity
I. Balance at the end of last
636,449,338 1,625,315,350.37 299,407,759.26 341,190,219.48 2,902,362,667.11
year
Add: Changes of accounting
policy
97
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Error correction of the last
period
Others
II. Balance at the beginning
636,449,338 1,625,315,350.37 299,407,759.26 341,190,219.48 2,902,362,667.11
of this year
III. Increase/ Decrease in
this year (Decrease is listed 110,870,938.47 110,870,938.47
with'"-")
(i) Net profit 110,870,938.47 110,870,938.47
(ii) Other consolidated
income
Subtotal of (i)and (ii) 110,870,938.47 110,870,938.47
(III) Owners' devoted and
0 0 0 0 0 0 0 0
decreased capital
1. Owners' devoted capital
2. Amount calculated into
owners' equity paid in
shares
3. Others
(IV) Profit distribution 0 0 0 0 0 0 0 0
1. Withdrawal of surplus
reserves
2. Withdrawal of general
risk reserve
3. Distribution for owners
(shareholders)
4. Others
(V) Carrying forward
0 0 0 0 0 0 0 0
internal owners' equity
1. Capital reserves
conversed to capital (share
capital)
2. Surplus reserves
conversed to capital (share
98
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
capital)
3. Remedying loss with
surplus reserves
4. Others
(VI) Reasonable reserve
1. Withdrawal in this
period
2. Usage in this period
(VII) Other
IV. Balance at the end of the
636,449,338 1,625,315,350.37 299,407,759.26 452,061,157.95 3,013,233,605.58
report period
Amount in last year
Unit: RMB
Amount in last year
Item Paid-up capital Less: Treasury Reasonable Surplus General risk Total owners’
Capital reserves Retained profit
(Share capital) Stock reserve reserves reserve equity
I. Balance at the end of last
530,374,449 1,625,421,425.24 279,379,527.83 293,529,748.86 2,728,705,150.93
year
Add: Changes of accounting
policy
Error correction of the last
period
Others
II. Balance at the beginning
530,374,449 1,625,421,425.24 279,379,527.83 293,529,748.86 2,728,705,150.93
of this year
III. Increase/ Decrease in
this year (Decrease is listed 106,074,889 -106,074.87 20,028,231.43 47,660,470.62 173,657,516.18
with'"-")
(i) Net profit 200,282,314.3 200,282,314.3
(ii) Other consolidated
income
Subtotal of (i)and (ii) 200,282,314.3 200,282,314.3
(III) Owners' devoted and
106,074,889 -106,074.87 0 0 0 0 0 105,968,814.13
decreased capital
99
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
1. Owners' devoted capital 106,074,889 106,074,889
2. Amount calculated into
owners' equity paid in shares
3. Others -106,074.87 -106,074.87
(IV) Profit distribution 0 0 0 0 20,028,231.43 0 -152,621,843.68 -132,593,612.25
1. Withdrawal of surplus
20,028,231.43 -20,028,231.43
reserves
3. Withdrawal of general
risk reserve
3. Distribution for owners
-132,593,612.25 -132,593,612.25
(shareholders)
4. Others
(V) Carrying forward
0 0 0 0 0 0 0 0
internal owners' equity
1. Capital reserves
conversed to capital (share
capital)
2. Surplus reserves
conversed to capital (share
capital)
3. Remedying loss with
surplus reserves
4. Others
(VI) Reasonable reserve
3. Withdrawal in this
period
4. Usage in this period
(VII) Other
IV. Balance at the end of the
636,449,338 1,625,315,350.37 299,407,759.26 341,190,219.48 2,902,362,667.11
report period
Legal representative: Liu Tibin
Person in charge of accounting works: Yu Wanchun
Person in charge of accounting institution: Tang Bin
100
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
I. Basic information of the Company
1. Company profile
Hefei Meiling Co., Ltd (hereinafter referred to as “the Company”) is an incorporated
Company established and reorganized by Hefei Meiling Refrigerator General Factory and
approved on June 12th 1992 through [WanTiGaiHanZi (1992) No.039] issued by original
Mechanism Reform Committee of Anhui Province. On August 30th 1993, through Anhui
Provincial Government [Wanzhenmin (1993) No.166] and re-examination of China
Securities Regulatory Commission, the Company made first public issue for 30 million A
shares and the Company was listed on Oct. 18th, 1993 in Shenzhen Stock Exchange. On
August 13th, 1996, the Company was approved to issue 100 million B shares to investors
abroad through [ZhengWeiFa(1996) No.26] issued by China Securities Regulatory
Commission. The Company went public in Shenzhen Stock Exchange on August 28th, 1996.
State-owned Assets Supervision & Administration Commission of the State Council
approved such transfers with Document Guozi Chanquan No.253 in 2007 Reply on Matters
of Hefei Meiling Group Holdings Company Limited Transferring Partial State-owned
Ownership, Hefei Meiling Group Holdings Company Limited (hereinafter abbreviated as
Meiling Group) transferred its holding 37,852,683 shares in 82,852,683 state-owned shares
of the Company to Sichuan Changhong Electronic Group Co., Ltd (hereinafter abbreviated
as Changhong Group), other 45,000,000 shares to Sichuan Changhong Electric Co. Ltd
(hereinafter abbreviated as Sichuan Changhong). On Aug 15, 2007, the above ownerships
were transferred and Cleaning Corporation Limited.
On 27 August 2007, State-owned Assets Supervision & Administration Commission of
Anhui Provincial Government replied with Document [WGZCQH(2007) No.309] Reply on
“Related Matters of Share Merger Reform of Meiling Co., Ltd.”, agreed the Company’s
ownership split reform plan. The Company made consideration that non-tradable share
holders deliver 1.5 shares to A share holders per 10 shares, and original Meiling Group made
prepayment 3,360,329 shares for some non-tradable share holders as consideration for split
reform plan.
On 29 May 2008, concerning 34,359,384 state-owned shares (including 3,360,329 shares
paid for other non-tradable shareholders by original Meiling Group in share reform) held by
original Meiling Group, the “Notice of Freely Transfer of Meiling Electrics Equity held by
Meiling Group”[HGZCQ(2008) No. 59] issued from State-owned Assets Supervision &
Administration Commission of Hefei Municipal, agrees to transfer the above said shares to
Hefei Xingtai Holding Group Co., Ltd.(“Xingtai Holding Co.,”) for free. On 7 August 2008,
the “Reply of Transfer Freely of Part of the Shares of Hefei Meiling Co., Ltd. held by
State-owned shareholders”[GZCQ(2007) No. 750] issued by SASAC, agrees the above said
transferring.
On October 28, 2008, 12,543,559.00 tradable shares, the first batch of the Company with
conditional subscription, were released for trading.
On October 29, 2008, Changhong Group Company signed Agreement on Equity Transfer of
Hefei Meiling Co., Ltd with Sichuan Changhong, in which 32,078,846 tradable A-shares
with conditional subscription of the Company (accounting for 7.76% in total shares) held by
Changhong Group Company. On 23 December 2008, “Reply of Transfer Freely of Part of
the Shares of Hefei Meiling Co., Ltd. held by State-owned shareholders”[GZCQ(2008) No.
1412] issued by SASAC agrees the above said share transferring.
On January 4, 2010, 74,074,020 tradable shares, the second batch of the Company with
conditional subscription, were released for trading.
On March 23, 2010, 2,783,342 tradable shares, the third batch of the Company with
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
conditional subscription, were released for trading.
On December 15, 2010, 29,127,572 tradable shares, the forth batch of the Company with
conditional subscription, were released for trading.
On 24 December 2010, being deliberated and approved in 32nd Meeting of 6th Session of the
Board and 2nd Extraordinary Shareholders’ General Meeting of 2010 as well as approval of
document [ZJXP(2010) No. 1715] from CSRC, totally 116731500 RMB ordinary shares (A
stock) were offering privately to target investors with issue price of RMB 10.28/share.
Capital collecting amounting to RMB 1,199,999,820, after issuing expenses RMB
22,162,232 deducted, net capital collected amounting to RMB 1,177,837,589, and paid-in
capital(share capital) increased RMB 116,731,500 with capital reserve(share premium)
RMB 1,061,106,088.5 increased. The increasing capital has been verified by Capital
Verification Report No.: ［XYZH2010CDA6021］issued from Shinwing CPA Co., Ltd. On 4
August 2011, Company implemented profit distribution plan for year of 2010 that
deliberated and approved in Shareholders’ Genral Meeting dated 20 June 2011, taking total
shares of the Company 530,374,449 shares ended as December 31 2010 as base, deliver cash
dividend of RMB 0.5(tax included) with 2 shares bonus for every 10 shares held by all
shareholders. The distribution plan amounting to RMB 132,593,612.25, a 45.17% in profit
available for shares realized in 2010. And share capital of RMB 106,074,889 increased.
Being distributed, total share capital of the Company increased to 636,449,338 shares
(including 500,729,338 shares of A-stock and 135,720,000 shares of B-stock). The
increasing capital has been verified by Capital Verification Report No.:
［WHSZDKYZi(2011) No.:141］issued from Anhui Huashen Zhengda CPA Co., Ltd.
On 11 January 2012, part of the restricted shares of privately A-share offering in 2010 was
un-lock, totally 7 shareholders (excluding shares purchased by controlling shareholder -
Sichuan Changhong Electronic Co., Ltd.) were un-lock in this time. Un-lock shares
amounting to 93,385,200 shares, a 14.67% in total share capital of the Company.
The 5th restricted circulating shares after implementation of share-split reform was un-lock
for trading dated 30 March 2012. Totally 5 shareholders are have shares released, un-lock
shares amounting to 607,846 shares, a 0.0955% in total share capital of the Company.
Ended as 30 June 2012, total share capital of the Company amounting to 636,449,338 shares
with ordinary shares in full. Among which, 500,729,338 shares of A-share accounting
78.67% in total shares while B-share with 135,720,000 shares accounting 21.33% in total
shares. Detail share capital as:
Type of stock Quantity Proportion
I. Restricted shares 55,390,228 8.70%
1. State-owned shares - -
2. State-owned legal person’s shares 47,463,010 7.46%
3. Other domestic shares 7,927,218 1.24%
Including: Domestic non-state-owned
7,721,266 1.21%
legal person’s shares
Domestic natural person’s shares 205,952 0.03%
4. Foreign shares - -
Including: Foreign legal person’s shares - -
Foreign natural person’s shares - -
5. Senior executives’ shares - -
II. Unrestricted shares 581,059,110 91.30%
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
1. RMB Ordinary shares 445,339,110 69.97%
2. Domestically listed foreign shares 135,720,000 21.33%
3. Overseas listed foreign shares - -
4. Others - -
III. Total shares 636,449,338 100.00%
2. Business nature and its business activities
The Company belongs to the manufacture of light industry, and engaged in the production
and sale of refrigerator, freezer and air-conditioner. Registration No. of the Business License
of Corporation Legal Person: 340000400001278; Address: No.2163, Lianhua Road,
Economy and Technology Development Zone, Hefei City; Legal Representative: Liu Tibin;
register capital(paid-in capital): RMB 636,449,338; Business Scope: Manufacture of
cooling apparatus, air-conditioner, washing machine, injection plastic machine of computer
controlling, computer heater, plastic products, packaging products and decorations. Business
of self-produced products, technology export and import&export of the raw&auxilary
materials, machinery equipment, instrument and technology; department sales and
transportation
3. Name of the parent Company and final actual controller of the Group
Ended 30 June 2012, Sichuan Changhong and its accord actionist totally held 24.88% shares
of the Company and is the first largest shareholder; Changhong Group held 23.19% shares
of Sichuan Changhong accounting and is the first largest shareholder of Sichuan Changhong;
State-owned Assets Supervision & Administration Commission of Mianyang Municipality
held 100% equities of Changhong Group and is the final actual controller of the Company.
Xingtai Holding Company held 6.26% shares of the Company accounting and is the second
largest shareholder of the Company.
II. Basis for preparation of financial statement
The financial statements of the Company were prepared in accordance with the actual
transactions and proceedings, and relevant regulation of Accounting Standards for
Enterprise released by the Ministry of Finance, and was on the basis of sustainable operation,
and the accounting policy and estimation stated in the IV-“Significant Accounting Policy,
Accounting Estimation and Preparation Method for Consolidated Financial Statement”.
III. Statement on Observation of Accounting Standard for Enterprise
The financial statement prepared by the Company applies with the requirements of
Accounting Standard for Enterprise, and reflects the financial condition, operational
achievements and cash flow of the Company effectively and completely.
IV. Significant Accounting Policy, Accounting Estimation and Preparation Method for
Consolidated Financial Statement
1. Accounting period
The accounting period of the Company is the calendar date from 1 January to 30 June
2. Standard currency for accounting
The Company takes RMB as the standard currency for accounting.
3. Accounting basis and pricing principle
The Company adopts accrual basis accounting as the accounting basis for accounting
calculation. Except for the tradable financial assets and financial assets available-for-sale are
measured with fair value, historical cost is used as pricing principle.
4. Cash and cash equivalent
The cash reflected in the cash flow statement of the Company represents the inventory cash
and the deposit available for payment at any time. And the cash equivalent in the cash flow
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
statement refers to the kind of investment with holding term not exceeding 3 months and
strong flow ability. At the same time, the cash equivalent is easy to convert into cash with
already-known amount and risk of value change is very small.
5. Foreign currency business and foreign currency financial statement conversion
(1) Foreign currency business
As for the foreign currency business, the Company converts the foreign currency amount
into RMB amount pursuant to the spot exchange rate as of the business day. As at the
balance sheet date, monetary items expressed by foreign currency are converted into RMB
pursuant to the spot exchange rate as of the balance sheet date. The conversion difference
occurred is recorded into prevailing gains and losses, other than the disclosure which is
made according to capitalization rules for the exchange difference occurred from the special
foreign currency borrowings borrowed for constructing and producing the assets satisfying
condition of capitalization. As for the foreign currency non-monetary items measured by fair
value, the amount is then converted into RMB according to the spot exchange rate as of the
confirmation day for fair value. And the conversion difference occurred during the
procedure is recorded into prevailing gains and losses directly as change of fair value. As for
the foreign currency non-monetary items measured by historical cost, conversion is made
with the spot exchange rate as of the business day, with no change in RMB amount.
(2)Conversion of foreign currency financial statement
Spot exchange rate as of the balance sheet date is adopted for conversion of assets and
liabilities in foreign currency balance sheet; as for the items in statement of owners’ equity
except for “Undistributed profit”, conversion is made pursuant to the spot exchange rate of
business day; income and expense items in income statement then are also converted
pursuant to the spot exchange rate of transaction day. Difference arising from the
aforementioned conversions shall be listed separately in items of owners’ equity. Spot
exchange rate as of the occurrence date of cash flow is adopted for conversion of foreign
currency cash flow. The amount of cash affected by exchange rate movement shall be listed
separately in cash flow statement.
6. Financial assets and financial liabilities
(1) Financial assets
i) Classification of financial assets
In consideration of investment targets and economic essence, the Company groups the
financial assets owned by it as four categories, namely financial assets measured by fair
value and whose movement is recorded into prevailing gains and losses, held-to-maturity
investment, loans and accounts receivables, as well as financial assets available-for-sale.
Financial assets measured by fair value and whose movement is recorded into prevailing
gains and losses represent the financial assets which are held mainly for disposal in a short
time and listed as tradable financial assets in the balance sheet.
Held-to-maturity investment represents the non-derivative financial assets which has fixed
maturity day, fixed or available-for-confirmation recovered amount and for which the
management has definite intention and ability to hold till maturity.
Loans and accounts receivables represent the non-derivative financial assets which have no
quotation in an active market and fixed or available-for-confirmation recovered amount.
Financial assets available-for-sale including the non-derivative financial assets
available-for-sale and the financial assets which have not been grouped as others at the
initial confirmation
ii) Recognition and measurement for financial assts
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Financial assets, while become party of the contract of financial instrument in the Company,
recognized in balance sheet by fair value. For the financial assets which are measured by
fair value and whose fair value change is recorded into prevailing gains and losses, the
relevant transaction expense arising from acquisition is recorded into prevailing gains and
losses directly, while the relevant transaction expense of other financial assets is recorded
into initial recognition amount.
Financial assets which are measured by fair value and whose fair value change is recorded
into prevailing gains and losses, together with financial assets available-for-sale, would have
follow-up measurement according to fair value; effective interest method is adopted for
loans and accounts receivables and held-to-maturity investment which are shown in
amortized cost.
Fair value change of financial assets which are measured by fair value and whose fair value
change is recorded into prevailing gains and losses is recorded into gains and losses of fair
value change; interests or cash dividend acquired from holding assets are recognized as
investment income; when disposing such assets, the difference between their fair value and
initial accounting amount is recognized as investment gains and losses. Meanwhile, gains
and losses of fair value shall be adjusted.
Except impairment losses and exchange gains/loss from financial assets with foreign
currency, variation of the fair value for financial assets available for sale should reckon into
shareholders’ equity. The variation of fair value accumulative reckon into equity
previously should transfer into current gains/losses while recognition of this financial asset
terminated. For the interest during period of holding for instrument investment of liability
available for sale based on real interest rate, and cash dividend related with instrument
investment of equity available for sale that announced by invested enterprises should reckon
into current gains/losses as investment incomes.
iii) Impairment of financial assets
Except for the financial assets which are measured by fair value and whose fair value change
is recorded into prevailing gains and losses, the Company will make check in the carrying
value of other financial assets as at the balance sheet date. If there is objective evidence
proving impairment of certain financial assets, the Company then makes provision for
impairment.
When the financial assets calculated by amortized cost decrease in value, count and draw the
provision for impairment according to the balance between present value and book value of
predicted future cash flows (Excluding future credit losses that haven’t occurred yet.). If
there is any objective evidence to indicate that the financial assets has recovered and is
objectively connected with matters occurred after confirming the losses, the formerly
confirmed impairment losses will be reversed and reckoned in current profits and losses.
When the fair value of financial assets available for sale goes down substantially or non-
transiently, the accumulating losses previously and directly reckoned in shareholder's equity
and formed due to shrinkage of fair value will be transferred and reckoned in impairment
losses. As for the debt instrument investment available for sale with confirmed impairment
losses, if its fair value rises after and it is objectively connected with matters occurred after
confirming the primary impairment losses, the formerly confirmed impairment losses will be
reversed and reckoned in current profits and losses. And the debt instrument investment
available for sale with confirmed impairment losses shall be directly reckoned in
105
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
stockholder's equity if its fair value rises after.
iv) Transfer of financial assets
The financial assets meet one of following requirements will be terminated recognition: ①
The contract rights of collecting cash flow of the financial assets is terminated; ②The
financial assets has already been transferred, and the Company has transferred almost all
risks and remunerations of financial assets ownership to the transferee; ③The financial
assets has been transferred, even though the Company has neither transferred nor kept
almost all risks and remunerations of financial assets ownership, the Company has given up
controlling the financial assets.
If the enterprise has neither transferred or kept almost all risks and remunerations of
financial assets ownership, nor given up controlling the financial assets, then confirm the
relevant financial assets according to how it continues to involve into the transferred
financial assets and confirm the relevant liabilities accordingly. The degree of keeping
involving into the transferred financial assets refers to the risk level with which the
fluctuation of this financial asset value makes the enterprise face.
If the entire transfer of financial assets satisfies the demand for derecognition, reckon the
balance between the book value of the transferred financial assets and the sum of
consideration received from transfer and fluctuation accumulated amount of fair value
formerly reckoned in other consolidated income in the current profits and losses.
If part transfer of financial assets satisfies the demand for derecognition, apportion the
integral book value of the transferred financial assets between the derecognized parts and the
parts not yet derecognized according to each relative fair value, and reckon the balance
between the sum of consideration received from transfer and fluctuation accumulated
amount of fair value formerly reckoned in other consolidated income that should be
apportioned to the derecognized parts and the apportioned aforementioned carrying amounts
in the current profits and losses.
(2)Financial liabilities
When making the initial recognition for financial liabilities, the Company classifies the
financial liabilities into ones which are measured by fair value and whose change is recorded
into prevailing gains and losses, and other financial liabilities.
Financial liabilities which are measured by fair value and whose change is recorded into
prevailing gains and losses include tradable financial liabilities and financial liabilities
which are measured by fair value and whose change is recorded into prevailing gains and
losses at the initial recognition day. Follow-up measurements are made by fair value.
Recorded into prevailing gains and losses are the gains or losses formed through fair value
change and dividend and interest expenditure regarding to the financial liabilities.
As for other financial liabilities, effective interest rate method is adopted and follow-up
measurement is made according to amortized cost.
(3)Method for recognition of fair value of financial assets and liabilities
For those financial instruments existing in active markets, market quotation in the active
market is used to confirm their fair values. In active market, the Company takes the present
bid price of already-held financial assets or plan-to-undertake financial liabilities as the fair
values of relevant assets and liabilities; the Company takes the present offer price of
plan-to-buy financial assets and –already-undertaken liabilities as the fair values of relevant
assets and liabilities. In the situation that there are no present bid and offer price for financial
106
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
assets and liabilities, while there is no material change in economic environment after the
latest business day, then fair value of the financial assets and liabilities is to confirm
pursuant to the latest business market quotation.
Fair value of the financial instruments which have no active market is confirmed by
adoption of estimation technology. Estimation technology includes reference to the price
applied by parties which know well situation and are willing to make deals in the latest
market business, reference to the current fair value of other financial assets which are the
same in principle, reference to discounted cash flow method and option pricing model.
7. Bad debt provision for accounts receivable
The following situation as standards for confirmation of bad debt losses of accounts
receivable: revoke, bankruptcy, insolvency, serious insufficiency of cash flow of its debit
units, or the debit units have to stop production due to serious natural disaster and are not
able to settle the debts or in predicted time, or other definite evidence showing that the debt
is not available to call back or the possibility of calling back is tiny.
Allowance method is adopted for the bad debt losses which are likely to happen. And
conducting impairment test independently or by combination at period-end, withdrawn bad
debt provision and then recorded into current gains and losses. As for the accounts
receivable which are not able to call back through definite evidence, they shall be treated as
bad debt losses after approval of the Group according to regulated procedures to offset
withdrawn bad debt provision.
(1)Accountreceivablewithsinglesignificantamountandwithdrawalsingleitembaddebtprovision
Beginning from test of single amount with 5% in total , if totally amount
Determine basis or amount takes over 80% of the total for over 5% occupied, than 5% of single
standards for single amount in total amounts recognized as single significant amount; if
significant amount totally amount takes less than 80% of the total for over 5% occupied,
than lower recognition standards till qualified 80% in total
withdrawal method for
account with single significant Withdrawal bad debt provision according to difference between the
amount and withdrawal single current value of future cash flow and book values
item bad debt provision
(2)Accountreceivablewithdrawalbaddebtprovisionbasedoncombination:
Basis for combination recognized
Combination 1 Account receivable except for those in Combination 2
Account receivable of the reserve fund of employee, investment externally,
Combination 2 connected account with related parties, export tex refund receivable, account
receivable with L/C or guarantee, government subsidy etc.
Methods on withdrawal of bad debt provision based on combination
Combination 1 Age analysis
Combination 2 Balance proportion
Combination 1: withdrawal proportion of bad debt provision for account receivable based on
age analysis:
Withdrawal proportion of account Withdrawal proportion of other
Age
receivable (%) account receivable (%)
Within 1year(1year
5 5
included )
1－2years 15 15
2－3 years 35 35
3－4 years 55 55
4－5 years 85 85
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Over 5 years 100 100
Combination 2: withdrawal proportion of bad debt provision for account receivable based on
balance proportion:
Withdrwal proportion of account Withdrwal proportion of other
Combination
receivable (%) account receivable (%)
Combination 2 0.00% 0.00%
Account receivables in combination 2 have the risk in control and withdrawal no bad debt
provision.
(3) Account receivable with single minor amount but withdrawal single item bad debt
provision:
Reasons for withdrawal single Account with minor amount but have significant inflow risk on predicted
item bad debt provision future cash flow
Impairment test on the current value of predicted future cash flow, bad debt
provision withdrawal. If depreciation occurred, independently withdrawal
withdrawal method for bad
bad debt provision without combination basis; if no depreciation happened,
debt provision
impairment test base on the combination nature that included in the
combination.
8. Inventories
Inventories of the Company principally include raw materials, stock goods; work in process,
self-made semi-finished product, materials consigned to precede, low-value consumption
goods, goods sold goods in process and mould etc.
Perpetual inventory system is applicable to inventories. For daily calculation, standard price
is adopted for raw materials, low-value consumption goods and stock goods. Switch-back
cost of the current month is adjusted by distribution price difference at the end of the month,
the dispatched goods will share the cost differences of inventory while in settlement the
business income; and low-value consumption goods is carried forward at once when being
applied for use; the mould expenses will evenly deferred share based on balance at
period-begin plus increase amount in this period divided by 12 months.
Inventory at period-end valued by the Lower-of-value between the cost and net realizable
value. For those individual stock, suffering damage, totally or partly out of fashion or has
lower sales price than cost, predicted recoverable parts in cost, and withdrawal provision of
inventory depreciation single. For those raw materials, stock commodities and goods sold,
withdrawal provision of inventory depreciation by follow methods:
(1)Determinedthenetrealizablevalueofrawmaterialsonthehigheramountbetween
the final prices of estimated sale‐price deducted cost (about to happen till products
finished), estimated sales expense and relevant taxes, and the fair value of external
disposal.
(2)Withdrawalobsoleteprovisionforcommoditystocksandsend‐outcommoditybythe
followproportion:
Withdrawal proportion for obsolete
Grade Stock duration
provision
Within 3 months 0%
4-6 months 5%
Grade-A 7-12 months 15%
1-2 years 25%
2-3 years 40%
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Over 3 years 100%
Qualified 40%
Grade-B 50%
Grade-C 60%
Disposal 65%
Unqualified 60%
Sample machine 30%
Special user type that exceed the order quantity 50%
The Company re-checks the above mentioned proportion at every end of the year. Calculated
the net realizable value by difference between the estimated sale price less the estimated
sales expense and relevant taxation; after comparison with the book value of commodity
stocks and sent-out commodity, determined whether adjusted the proportion or not.
(3) The present products produced according to the market requirement usually, and
withoutsignificantobsoleteevidenceinshort‐term,sowithdrawalnoobsoleteprovision.
(4) Mould expense will amortize in instalment in usual times. Once the use‐life of mould
beingterminated,thantransferitsremainingcostintogains/losses,andnowithdrawalof
obsoleteprovisionatperiod‐end
9. Long-term equity investment
Long-term equity investment mainly includes the equity investment which entitles the
Company to conduct control, common control or significant influence over the invested units,
and the equity investment which couldn’t entitle the Company to conduct control, common
control or significant influence over the invested units and which have no quotation price in
active market and whose fair value could not be able to measured surely.
Common control refers to the control jointly enjoyed upon certain economic activity
according to regulations of contract. The reference to confirm a common control mainly
refers to that any single party of a joint-venture entity has no possibility to individually
control the production operation of the joint-venture; any decision relating to basic
operation activity of joint-venture entity all requires unanimous agreement from each party.
Significant influence equals to that investor has right to participate in making decision for
finance and operational strategy of invested unit, while it has no right to control or jointly
control with other parties upon formation of these strategies. As long as the Company
directly or indirectly holds through its subsidiaries over 20% but less than 50% voting
shares of the invested unit, then it could be called a significant influence. However, if there is
obvious evidence showing that the Company is not qualified in participating in making
production and operation decisions of the invested one, then no significant influence could
stand up.
In situation of a long-term equity investment acquired by the Company through business
combination under common control, the carrying value of the owners’ equity of the acquired
company as at the combination date is deemed as initial investment cost for this long-term
equity investment. In situation of a long-term equity investment acquired by the Company
through business combination not under common control, the combination cost is
recognized according to the fair value of assets, liabilities occurred or undertaken, and
equity securities issued as at the combination (purchase) date for obtaining control right
over the acquired (purchased) party.
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AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Excluding the long-term equity investment acquired through business combination, there is
also a king of long-term equity investment acquired through cash payment, for which the
actual payment for the purchase shall be initial investment cost; If Long-term equity
investments are acquired by issuing equity securities, fair value of issuing equity investment
shall be initial investment cost; for Long-term equity investments which are invested by
investors, the agreed price in investment contract or agreement shall be initial investment
cost; and for long-term equity investment which is acquired through debt reorganization and
non-monetary assets exchange, regulations of relevant accounting standards shall be referred
to for confirming initial investment cost.
The Company adopts cost method for investment in subsidiaries and makes adjustment by
equity method when preparing combinated financial statement; makes calculation for
investments in joint-ventures and associates by equity method; make calculation by cost
method for long-term equity investment upon which the Company has no control, common
control or significant influence and which have no quotation price in active market and
whose fair value could not be able to measured surely; and for the long-term equity
investment upon which the Company has no control, common control or significant
influence while which do have quotation price in active market and whose fair value could
be able to measured surely, the Company calculate it as financial asset available-for-sale.
When calculated by cost method, long-term equity investment is priced according to its
initial investment cost, and cost of the investment is adjusted when making additional
investment or writing off investment; When calculated by equity method, current investment
gains and losses represent the proportion of the net gains and losses realized by the invested
unit in current year attributable to or undertaken by the investor. When the Company is
believed to enjoy proportion of net gains and losses of invested unit, gains and losses
attributable to the Company according to its shareholding ratio is to computer out according
to the accounting policy and accounting period of the Company, on the basis of the fair
value of various recognizable assets of the invested unit as at the date of obtaining of the
investment, after offset of gains and losses arising from internal transactions with associates
and joint-ventures, and finally to make confirmation after adjustment of net profit of the
invested unit. Confirmation on gains and losses from the long-term equity investment in
associates and joint-ventures held by the Company prior to the first execution day, could
only stand up with the precedent condition that debit balance of equity investment straightly
amortized according to its original remaining term has already been deducted, if the
aforementioned balance relating to the investment do exist.
The Company switches to cost method for calculating the long-term equity investments
which do not entitle the Company to have common control or significant influence over the
invested units and which have no quotation in active market and whose fair value could not
be able to measured surely due to decrease of investments by the Company; and also
switches to cost method for calculating the long-term equity investments which entitles the
Company to have conduct control over the invested units due to its additional investments;
and switches to equity method for calculating the long-term equity investments which
entitles the Company to conduct common control or significant influence, while no control
over the invested units due to its additional investments, or the long-term equity investments
which entitles the Company with no control over the invested units any longer while with
common control or significant influence.
When disposing long-term equity investment, the balance between its carrying value and
effective price for obtaining shall be recorded into current investment income. When
disposing long-term equity investment which are calculated by equity method, the
110
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
proportion originally recorded in owners’ equity shall be transferred to current investment
income according to relevant ratio, except for that other movements of owners’ equity
excluding net gains and losses of the invested units shall be recorded into owners’ equity
10. Investment real estate
The investment real estate of the Company includes leased houses and buildings, and is
accounted value by its cost. Cost of purchased-in investment real estate consists of payment
for purchase, relevant taxes and other expenditure which is attributable to the assets directly;
while cost of self-built investment real estate is formed with all necessary expenditures
occurred before construction completion of the assets arriving at the estimated utilization
state.
Consequent measurement of investment estate shall be measured by cost method.
Depreciation is provided with average service life method pursuant to the predicted service
life and net rate of salvage value. The predicted service life and net rate of salvage value and
annual depreciation are listed as follows:
Depreciation term Predicted rate of Depreciation rate per
Type
(year) salvage value (%) annum (%)
30-40
Houses and buildings 4% 2.40%-3.20%
years
When investment real estate turns to be used by holders, it shall switch to fixed assets or
intangible assets commencing from the date of such turning. And when self-used real estate
turns to be leased out for rental or additional capital, the fixed assets or intangible assets
shall switch to investment real estate commencing from the date of such turning. In situation
of switch, the carrying value before the switch shall be deemed as the credit value after the
switch.
When investment is disposed, or out of utilization forever and no economic benefit would be
predicted to obtain through the disposal, the Company shall terminate recognition of such
investment real estate. The amount of income from disposal, transfer, discarding as scrap or
damage of investment real estate after deducting the asset’ s carrying value and relevant
taxation shall be written into current gains and losses.
11. Fixed assets
Fixed assets of the Company represent the tangible assets and assets package: held by the
Company for purpose of producing commodities, providing labor service, leasing or
operational management, service life exceeds one year, and unit price exceeds RMB 2,000.
Including four categories of houses and buildings, machinery equipments, transportation
equipments and other equipments
Their credit value is determined on the basis of the cost taken for obtaining them. Of which,
cost of purchased-in fixed assets include bidding price and import duty and relevant taxes,
and other expenditure which occurs before the fixed assets arrive at the state of predicted
utilization and which could be directly attributable to the assets; while cost of self-built fixed
asset is formed with all necessary expenditures occurred before construction completion of
the assets arriving at the estimated utilization state; credit value of the fixed assets injected
by investors is determined based on the agreed value of investment contracts or agreements,
while as for the agreed value of investment contracts or agreements which is not fair, it shall
take its fair value as credit value; and for fixed assets which are leased in through finance
leasing, credit value is the lower of fair value of leased assets and present value of
minimized leasing payment as at the commencing date of leasing.
Consequent expenditure related to fixed assets consists of expenditures for repair and update
reform. For those meeting requirements for recognization of fixed assets, they would be
111
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
accounted as fixed asset cost; and for the part which is replaced, recognization of its carrying
value shall cease; for those not meeting requirements for recognization of fixed assets, they
shall be accounted in current gains and losses as long as they occur. When fixed asset is
disposed, or no economic benefit would be predicted to obtain through utilization or
disposal of the asset, the Company shall terminate recognization of such fixed asset. The
amount of income from disposal, transfer, discarding as scrap or damage of fixed asset after
deducting the asset’ s carrying value and relevant taxation shall be written into current gains
and losses.
The Company withdraws depreciation for all fixed assets except for those which have been
fully depreciated while continuing to use. It adopts average service life method for
withdrawing depreciation which is treated respectively as cost or current expense of relevant
assets according to purpose of use. The depreciation term, predicted rate of salvage value
and depreciation rate applied to fixed assets of the Company are as follows:
Predicted rate of Depreciation rate per
No. Type Depreciation term
salvage value annum
Houses and 30-40
1 4% 3.20%-2.40%
buildings years
Machinery 10-14
2 4% 9.60%-6.86%
equipments years
Transportation
3 5-12 years 4% 19.00%-8.00%
equipments
4 Other equipments 8-12 years 4% 12.00%-8.00%
The Company makes re-examination on predicted service life, predicted rate of salvage
value and depreciation method at each year-end. Any change will be treated as accounting
estimation change.
12. Construction in process
Construction in process is measured with effective cost. Self-operated constructions projects
are measured with direct materials, direct salaries and direct construction expense;
construction projects undertaken by external are measured with the engineering payment
payable; and engineering cost (income abatement) of equipment-installation projects is
confirmed with consideration of value of the equipments, installation fee, and expenditure
arising from trial operation of the projects. Borrowing expense and exchange gains and
losses which should be capitalized are also included in cost of construction in process.
Commencing from the date when construction in process reaches condition for predicted
purpose of use, the Company carries forward the estimated value of the construction to fixed
assets, pursuant to engineering budget, engineering cost or effective cost, and starts
depreciation withdraw from the next month. As long as procedure for completion settlement
is transacted, the Company shall make adjustment to difference of original value of the fixed
asset.
13. Borrowing expense
Borrowing expenses include interest expense, amortization of discount or premium,
auxiliary expenses and exchange difference due to borrowing in foreign currency. The
borrowing expense which could be directly attributable to purchase or production of assets
satisfying capitalization condition, starts capitalization when capital expenditure and
borrowing expense occur and when necessary purchase or production conducted for
promoting assets to reach the predicted available-for-use or available-for-sale state; and
capitalization shall cease when purchased or produced assets satisfying capitalization
112
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
condition have reached the predicted available-for-use or available-for-sale state. Other
borrowing expense is recognized as expense during the occurrence period.
Capitalization shall be exercised for interest expense actually occurred from special
borrowings in current period after deduction of the interest income arising from unutilized
borrowing capital which is saved in banks or deduction of investment income obtained from
temporary investment; For recognization of capitalized amount of common borrowing, it
equals to the weighted average of the assets whose accumulated expense or capital disburse
is more than common borrowing times capitalization rate of occupied common borrowing.
Capitalization rate is determined according to weighted average interest rate of common
borrowing.
Assets satisfying capitalization principle generally refer to fixed assets, investment real
estate and inventories which can only arrive at predicted available-for-use and
available-for-sale state after quite a long time (generally over one year) in purchase or
production activities.
If abnormal interruption happens during purchase or production of assets satisfying
capitalization principle and the interruption lasts over 3 months, the capitalization for the
borrowing expense shall pause until the purchase or production restarts.
14. Intangible assets
The Company holds intangible assets including land use right, trademark, patent technology
and non-patent technology. Intangible assets are measured according to the effective costs
paid for obtaining the assets. For those intangible assets purchased in by the Company, their
effective cost consist of actual payment and relevant other expenditure; for the intangible
assets input by investors, effective cost is determined according to the value agreed in
investment contracts and agreements, while if the agreed value is not fair, then effective
value is confirmed according to fair value.
Land use right is averagely amortized according to its transfer term commencing from the
sate of transfer; trademark use-rights averagely amortized by 10 years; patent technology,
non-patent technology and other intangible assets is averagely amortized according to the
shortest of their predicted service life, beneficial term concluded by contract and effective
term regulated by laws. Amortization amount is recorded in assets cost and current gains and
losses relevant to beneficial objectives.
Re-examination on predicted service life and amortization method of the intangible assets
which have limited service life shall be conducted at the end of each year. If changed, it
would be treated as change of accounting estimation. Re-examination on predicted service
life of intangible assets which have uncertain service life shall be conducted. For any
evidence proving that service life of intangible assets is limited, then the service life shall be
estimated and the Company shall make amortization within the predicted service life period.
15. Research and development
As for expenditure for research and development, the Company classifies it into expenditure
on research phase and development phase, based on nature of the expenditure and that
whether the final intangible assets formed by research & development is of great uncertainty.
Expenditure arising during research should be recorded in current gains and losses upon
occurrence; expenditure arising during development is confirmed as intangible assets when
satisfying the following conditions:
(1)Completions of the intangible assets makes it available for application or sell in
technology;
113
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
(2)Equippedwithplantocompletetheintangibleassetandapplyorsellit;
(3)Thereismarketforproductsproducedwiththisintangibleassetsortheintangibleasset
itself;
(4)Have sufficient technology, financial resource and other resources to support
developmentoftheintangibleassets,andhaveabilitytoapplyorselltheassets;
(5)Expenditure attributable to development of the intangible assets could be reliable
measured.
Expenditure arising during development not satisfying the above conditions shall be
recorded in current gains and losses upon occurrence. Development expenditure which had
been recorded in gains and losses in previous period would not be recognized as assets in
later period. Expenditure arising during development phase which has been starting
capitalization is listed in balance sheet as development expenditure, and transferred to
intangible assets since the project reaches at predicted utilization state.
16. Impairment of non-financial long-term assets
As at each balance sheet date, the Company has inspection on long-term equity investment,
fixed assets, construction in process and intangible assets with limited service life. When the
following indications appear, assets may be impaired, and the Company would have
impairment test. As for goodwill and intangible assets which have uncertain service life, no
matter there is impairment or not, impairment test shall be conducted at the end of every
year. If it is hard to make test on recoverable amount of single asset, test is expected to make
on the basis of the assets group or assets group portfolio where such asset belongs to.
After impairment test, if the carrying value exceeds the recoverable amount of the asset, the
balance is recognized as impairment loss. As long as impairment loss of the aforementioned
assets is recognized, it couldn’t be switched back in later accounting periods. Recoverable
amount of assets refers to the higher of fair value of assets net disposal expense and present
value of predicted cash flow of the asset.
Indications for impairment are as follows:
(1)Market value of asset drops a lot in current period, the drop scope is obviously greater
than the predicted drop due to move-on of times or normal utilization;
(2)Economy, technology or law environment where enterprise operates or market where
asset is located will have significant change in current or recent periods, which brings
negative influence to enterprise;
(3) Market interest rate or returning rate of other market investments have risen in current
period, which brings influence in calculating discount rate of present value of predicted
future cash flow of assets, which leads to a great drop in recoverable amount of such assets;
(4)Evidence proving that asset is obsolete and out of time or its entity has been damaged;
(5)Asset has been or will be keep aside, terminating utilization or disposed advance;
(6)Internal report of enterprise shows that economic performance of asset has been or will
be lower than prediction, such as that net cash flow created by asset or operation profit (or
loss) realized by asset is greatly lower (or higher) than the predicted amount;
(7)Other indications showing possible impairment of assets
17. Goodwill
Goodwill represents balance between equity investment cost or business combination cost
under no common control exceeding the attributable part or fair value of recognizable net
assets of party invested or purchased (obtained through business combination) as of
acquisition day or purchase day.
114
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Goodwill relating to subsidiaries is separately listed in consolidated financial statement. And
goodwill relating to associates and joint-ventures is included in carrying value of long-term
equity investment.
18. Long-term deferred expenses
Long-term deferred expenses of the Company refer to the expense which has been paid out
while should be amortized from the current period and periods thereafter, with amortization
term over 1 year (excluding 1 year). Such expense is averagely amortized during the
beneficial period. If such long-term deferred expense could not bring benefit to following
accounting periods, the unamortized value of the item shall be fully transferred to current
gains and losses.
19. Staff remuneration
The Company recognizes staff remuneration payable as liabilities during the accounting
period when staff provide services, and records it to relevant assets cost and expense based
on beneficial objectives of services provided by staff. Compensation for dismiss labour
relationship with employee shall be recorded in current gains and losses.
Staff remuneration principally includes salary, bonus, allowance, subsidy, welfare, social
insurance, housing public fund, labour union fee and special charge for education, etc, and
expenditure relevant to obtaining services provided by employee.
The early retirement policy for staff and workers of the Company is the compensation for
encouraging staff and workers to accept the reduction voluntarily. The employees make
applications voluntarily, the two parties sign the compensation agreement after approved by
the Company and calculate the compensation amount according to the compensation
standard passed by the staff representative conference, and the Company confirms it as
dismiss welfare and reckons it in current profits and losses. As the Company promises to
adjust the treatment for early retiring staff and workers with the increase of social basic cost
of living allowances, the discount elements will not be considered for calculating the dismiss
welfare.
20. Estimated liabilities
If the business in connection with such contingencies as a security involving a foreign party,
commercial acceptance bill discount, pending litigation or arbitration, product quality
assurance, etc. meets all of the following conditions, the Company will confirm the aforesaid
as liabilities: the obligation is an existing obligation of the Company; performance of the
obligation is likely to cause economic benefits to flow out of the enterprise; the amount of
the obligation is reliably measurable.
The Company predicted the maintenance fee for ten-year-free repairing on major parts of
country-oriented refrigerator based on the Three Guarantee and the implemented of Three
Guarantee policy of the Nation: Concerning the refrigerator of Three Guarantee policy,
calculated based on the 1% of current sales income, less current maintenance fee, the
in-sufficient part will predicted reckoned into predicted liability. Concerning the
country-oriented refrigerator based on the promise of ten-year-free repairing, withdrawal
methods and basis as:
Predicted liability of ten-year-free repairing =maintenance probability from 4 to 10 years
sales volume×overhaul proportion× overhaul fee per unit
Among which: maintenance probability from 4 to 10 years sales volume×proportion with
115
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
major or medium repairing will base on the historical maintenance data under the policy of
‘Three Guarantee”, being combine with technical analysis, speculated that the maintenance
portability from 4 to 7 years was the half of the maintenance proportion under “Three
Guarantee” policy; maintenance protability from 7 to 10 years was twice of the maintenance
proportion under “Three Guarantee” policy, the maintenance protability from 4 to 10 years
calculated by the rounded number from the above total. Overhaul proportion under ‘Three
Guarantee” will take the rounded number based on 50% up as the 4 to 10 years maintenance
overhaul (maintenance of major components) proportion; overhaul fee per unit including
transport fee, vehicle fee, maintenance fee and fitting fee, which will calculated based on the
maintenance agreement signed between the Company and after-sale service office.
Taken the predicted maintenance fee annually which calculated un-stablely, and the
uncertainly factors during 10 years into consideration, the Company provided no discount on
predicted liability temporary. Re-checking the above mentioned withdrawal
basis(probability, proportion and maintenance charge for single machine) based on the
actual maintenance fee on every balance sheet date, the Company will adjusted book value
for perfect presentation currently.
21. Principle of recognition of revenue
The Company’s sales revenue is mainly comprised of revenue from sale of goods, labour
providing income and revenue from assignment of asset use rights. The principle of
recognition of such revenue is as follows:
(1) Revenue from the sale of goods shall be recognized when the Company has transferred
to the buyer the significant risks and rewards of ownership of the goods; the Company
retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods sold; the amount of revenue can be measured
reliably; it is probable that the associated economic benefits will flow into the Company;
and the associated costs incurred or to be incurred can be measured reliably.
(2) The Company confirms the realization of service income when the gross income and
total cost of labor service cab be unfailingly calculated, the economic benefits related to
labor service are likely to flow into the Group, and the progress of labor service can be
confirmed reliably. On balance sheet date, with regard to those with results provided for
labor service transactions can be estimated reliably, confirm the relevant service income
according to percentage of completion method and determine the percentage-of-completion
method by the proportion of the occurred cost in the estimated total cost; as for those with
results provided for labor service transactions can’t be estimated reliably and with occurred
labor cost predicted to be able to get compensation, confirm to provide service income
according to labor cost amount occurred and capable of getting compensation, and carry
over the occurred labor costs; for those with results provided for labor service transactions
can’t be estimated reliably and with occurred labor cost predicted to be not able to get
compensation, reckon the occurred labor cost in the current profits and losses, but not
confirm to provide service income.
(3) The economy benefit of use-right of transfer assets probably wills inflow to the
Company, if the income can be measure accountability, than use-right income of transfer
assets recognized.
22. Subsidies of government
Government subsidy at the Company be able to meet its attached conditions, and can be
confirmed when received. Government grants(such as subsidy for energy-saving and
civil-beneficial of air-conditioner) for monetary assets, in accordance with the measurement
of the amount actually received, according to a fixed quota for the allocation of the grant
criteria, in accordance with the amount of accounts receivable measurement; government
116
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
subsidies for non-monetary assets, in accordance with the fair value, fair value should not
reliably achieved, in accordance with the notional amount (RMB 1.00) measurement.
Asset-related government grants recognized as deferred income, and average life of related
assets included in the current profit and loss distribution. With the proceeds of the relevant
government subsidies to compensate for the period after the relevant costs or losses
recognized as deferred income and, while recognizing the associated costs included in
current period profit and loss; for compensation related costs that have occurred or loss,
directly gains and losses included in the current period.
23. Deferred Income Tax Assets and Deferred Income Tax Liabilities
A deferred tax asset and deferred tax liability shall be determined by a difference (temporary
difference) between the carrying amount of an asset or liability and its tax base. The deferred
tax asset shall be recognized for the carry forward of unused deductible losses and tax
credits to the extent that it is probable that future taxable profits will be available against
which the deductible losses and tax credits can be utilized. At the balance sheet date,
deferred tax assets and deferred tax liabilities shall be measured at the tax rates that are
expected to apply to the period when the asset is realized or the liability is settled.
The Company shall recognize the corresponding deferred tax asset for deductible temporary
differences as no higher than the taxable profits that will be available in the future, against
which the temporary difference can be utilized. The Company shall reduce the carrying
amount of a deferred tax asset to the extent that it is no longer probable that sufficient
taxable profits will be available in future periods to allow the benefit of the deferred tax
asset to be utilized. Any such reduction in amount shall be reversed to the extent that it
becomes probable that sufficient taxable profits will be available.
24. Lease
The Company categorizes the lease into the financial lease and the operating lease.
The financial lease is the lease in which all risks and returns related to the ownership of
assets are transferred in substance. The Company as a lease holder, on the date of lease, the
financial lease is recognized as the fixed asset at lower cost of fair value of the rental asset
and the NPV of minimum payment of leasing. The minimum payment of leasing is
recognized as long-term payable and the difference is accounted into unrecognized financing
expense.
The operating lease is the lease apart from the financial lease. The Company, as a lease
holder, accounts the rents into current period by straight line method during the term of the
lease. The Company, as a leaser, accounts the rental income into current period by straight
line method during the term of the lease.
25. Income tax accounting
The Company accounted the income tax in a method of debit in balance sheet. The income
tax expenses include income tax in the current year and deferred income tax. The income tax
associated with the events and transactions directly included in the owners’ equity shall be
included in the owners’ equity; and the deferred income tax derived from business
combination shall be included in the carrying amount of goodwill, except for that above, the
income tax expense shall be included in the profit or loss in the current period.
117
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
The income tax expense in the current year refers to the tax payable, which is calculated
according to the tax laws on the events and transactions incurred in the current period. The
deferred income tax refers to the difference between the carrying amount and the deferred
tax assets and deferred tax liabilities at the year-end recognized in the method of debit in the
balance sheet.
26. Segment information
Business segment was the major reporting form of the Company, which divided into 4 parts:
air-conditioner, refrigerator and freezer, washing machine and others. The transfer price
among the segments will recognize based on the market price, common costs will allocated
by income proportion between segments except for the parts that without reasonable
allocation.
27. Business Combination
Business combination refers to the event or transaction that the Company combines two or
more separate enterprises as one reporting entity. The Company shall recognize the assets
and liabilities derived from business combination at the combination date or acquisition date.
A combination date or acquisition date is the date on which the Company effectively obtains
control of the company being absorbed
The assets and liabilities acquired through a business combination involving an enterprise
under common control shall be measured by the acquirer according to the carrying amount
recorded by the acquirer’s at the combination date. The difference between the consideration
of combination and the carrying amount of the acquired net assets shall be included in
capital surplus, or it shall be included in retained earnings continuously if the capital surplus
is not sufficient.
The cost of business combinations not involving an enterprise under common control is the
aggregate of the fair value, at the acquisition date, of the assets given, liabilities incurred or
assumed, and equity securities issued by the Company, in exchange for control of the
acquiree. When the costs of business combinations exceed the acquirer’s identifiable net
assets, the difference shall be recognized as goodwill, if not, the differences shall be
included in the profit or loss in the current period.
28. Measures on Preparation of Consolidated Financial Statements
(1)Recognizedprincipalsofconsolidatedareas
The Company shall put subsidiaries which it controlling totally, main body with special
purpose into consolidated financial statements.
(2)AccountingmethodforConsolidatedFinancialStatements:
Consolidated financial statements have been prepared in accordance with the ASBEs No. 33
Consolidated Financial Statements and relevant supplementary regulations. All significant
transactions and balances between the Company and its subsidiaries are eliminated for the
purpose of consolidation. The equity of subsidiaries not held by the parent company shall be
presented separately as minority shareholders’ equity in consolidated shareholders’ equity.
Any difference arising from the inconformity of accounting year or accounting policies
between the subsidiaries and the Company shall be adjusted in the consolidated financial
statements.
When preparing the consolidated financial statements, if the Company acquired the
subsidiary through business combination not involving under common control, the separate
financial statements shall be adjusted based on the fair value of identifiable net assets at the
acquisition date. If the subsidiary is acquired through business combination involving
118
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
common control, the consolidated financial statements shall include the carrying amount of
assets, liabilities, operating result and cash flow of the subsidiary at the beginning of the
current period.
V. Changes of accounting policies and accounting estimates and correction of previous
errors
1. Changes of accounting policies and effects: Nil
2. Contents and reasons of changes of accounting estimates: Nil
3. Correction of previous errors and effect: Nil
VI. Taxations
1. Major taxes (expenses) and tax rates
Tax(expenses) Tax base Tax rate
VAT Income from sales of goods and from processing 17%
Business tax Rental income and off-price expense 5%
Urban maintenance and
Turnover tax 5% or 7%
construction tax
Education surcharge Turnover tax 3%
Local education
Turnover tax 2%
surcharge
Corporate income tax Taxable income 15% or 25%
Original Book value of house property×(1-30%)or
House Property Tax 1.2% or 12%
annual rent income
Other taxes (tax of land-use, stamp tax, embankment maintenance fee and flood-protection
fee etc.) will pay accordance with local taxation (expenses) rate.
2. Preferencial tax and approval documents
Tax preference of enterprise income tax:
The Company and its subsidiary Zhongke Meiling Cryogenics Technology Limited
Company were recognized as second Hi-Tech Enterprise for year of 2008 in Anhui Province
with term of three years. Therefore, the Company and its subsidiary Zhongke Meiling
Cryogenics Technology Limited Company enjoys 15% rate for the income tax for State
Hi-Tech Enterprise. On 26 September 2011, being recognized by “Name Lists of First
Hi-Tech Enterprise for year of 2011 in Anhui Province”[WGQR(2011) No. 10] from Anhui
Science & Technology Department, the Company and its subsidiary Zhongke Meiling
Cryogenics Technology Limited Company continuous to enjoy 15% rate for the income tax
for State Hi-Tech Enterprise for three years term.
Subsidiary Zhongshan Changhong Appliance Co., Ltd. was recognized as First Hi-Tech
Enterprise for year of 2008 in Guangdong Province with 15% rate for the income tax for
State Hi-Tech Enterprise enjoys for term of three years. On 13 October 2011, being
recognized by “Name Lists of Second Hi-Tech Enterprise for year of 2011 in Guangdong
Province”[YKHGZi(2011) No.1437] from Guangdong Science & Technology Department,
Zhongshan Changhong Appliance Co., Ltd. continuous to enjoy 15% rate for the income tax
for State Hi-Tech Enterprise for three years term.
Subsidiary Sichuan Changhong Air Conditioner Co., Ltd. was granted the “Certificate of
High-tech Enterprise” (certificate No.: GR201051000154) with a maturity of three years
on 27 December 2011. Being approved and file by First Branch of Local Tax Bureau of
Mianyang City, Sichuan Changhong Air Conditioner Co., Ltd. was subject to enterprise
income tax at a rate of 15%.
119
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
VII. Business combination and consolidated financial statements
(I)Subsidiary
The balance after
the parent
company’s owner’s
equity writing
Balance
down the excess of
Investme of other Amount in
State the current loss
nt items Holdi Voting minority
Registere ments undertaken by
amount materiall ng right Minority interest used
Registrati Business d capital combi minority
Name Rating Type at yforming propo propor interest for writing
on place nature (RMB’00 ned or shareholders of the
year-end net rtion tion down
00) not subsidiary over the
(RMB’00 investme (%) (%) minority
share enjoyed by
00) nt to gain and loss
minority
subsidiar
shareholders in the
y
original owner’s
equity of the
subsidiary
Subsidiaries established through direct investment
Manufact
Zhongke Meiling Cryogenics Co., Limited
Subsidiary Hefei uring and 6,000.00 4,200.00 - 70.00 70.00 Yes 21,302,020.30 - -
Ltd. (1) Company
sales
Manufact
Jiangxi Meiling Refrigeration Co., Ltd. Limited Jingde
Subsidiary uring and 4,000.00 3,600.00 - 90.00 100.00 Yes - - -
(2) Company Town
sales
Manufact
Mianyang Meiling Refrigeration Co., Limited
Subsidiary Mianyang uring and 10,000.00 9,500.00 - 95.00 100.00 Yes - - -
Ltd. (3) Company
sales
Hefei Meiling Electric Marketing Co., Limited
Subsidiary Hefei Sales 5,500.00 5,490.00 - 99.82 100.00 Yes - - -
Ltd. (4) Company
Limited Jingde
Jiangxi Meiling Appliance Co., Ld. (5) Subsidiary Sales 5,000.00 4,937.50 - 98.75 100.00 Yes - - -
Company Town
nd
Changhong Ruba Trading Company 2 Limited
Pakistan Sales $300.00 $180.00 - 60.00 60.00 Yes 5,821,513.01 579,868.15 -
(Private) Limited(6) subsidiary Company
Xinxiang Meiling Electric Marketing 2nd Limited
Xinxiang Sales 350.00 206.50 - 59.00 59.00 Yes 713,819.27 721,180.73 -
Co., Ltd. (7) subsidiary Company
Luohe Meiling Electric Marketing Co., 2nd Limited
Luohe Sales 500.00 185.00 - 37.00 37.00 Yes 3,165,544.87 - -
Ltd. (8) subsidiary Company
Wuhu Meiling Electric Marketing 2nd Limited
Wuhu Sales 600.00 216.00 - 36.00 36.00 Yes 1,170,906.37 2,669,093.63 -
Co., Ltd. (9) subsidiary Company
Changchun Meiling Electric Marketing 2nd Limited Changchu
Sales 300.00 291.00 - 97.00 97.00 Yes -8,197.19 90,000.00 -
Co., Ltd. (10) subsidiary Company n
Bengbu Meiling Electric Marketing 2nd Limited
Bengbu Sales 300.00 255.00 - 85.00 85.00 Yes 630,570.91 - -
Co., Ltd. (11) subsidiary Company
120
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
The balance after
the parent
company’s owner’s
equity writing
Balance
down the excess of
Investme of other Amount in
State the current loss
nt items Holdi Voting minority
Registere ments undertaken by
amount materiall ng right Minority interest used
Registrati Business d capital combi minority
Name Rating Type at yforming propo propor interest for writing
on place nature (RMB’00 ned or shareholders of the
year-end net rtion tion down
00) not subsidiary over the
(RMB’00 investme (%) (%) minority
share enjoyed by
00) nt to gain and loss
minority
subsidiar
shareholders in the
y
original owner’s
equity of the
subsidiary
Hengyang Meiling Electric Marketing 2nd Limited
Hengyang Sales 300.00 123.00 - 41.00 41.00 Yes 981,967.32 788,032.68 -
Co., Ltd. (12) subsidiary Company
Nanchang Meiling Electric Marketing 2nd Limited
Nanchang Sales 300.00 108.00 - 36.00 36.00 Yes -1,989,085.35 1,920,000.00 -
Co., Ltd. (13) subsidiary Company
Lu'an Meiling Electric Marketing Co., 2nd Limited
Lu'an Sales 500.00 180.00 - 36.00 36.00 Yes 2,920,157.19 279,842.81 -
Ltd. (14) subsidiary Company
Jingzhou Meiling Electric Marketing 2nd Limited
Jingzhou Sales 400.00 240.00 - 60.00 60.00 Yes 144,612.99 1,455,387.01 -
Co., Ltd. (15) subsidiary Company
Shenyang Meiling Electric Marketing 2nd Limited
Shenyang Sales 300.00 284.40 - 94.80 94.80 Yes -97,505.49 156,000.00 -
Co., Ltd. (16) subsidiary Company
Wuhan Meiling Electric Marketing Co., 2nd Limited
Wuhan Sales 500.00 455.00 - 91.00 91.00 Yes -66,936.09 45,000.00 -
Ltd. (17) subsidiary Company
Zhengzhou Meiling Electric Marketing 2nd Limited Zhengzho
Sales 300.00 108.00 - 36.00 36.00 Yes 169,819.63 1,750,180.37 -
Co., Ltd. (18) subsidiary Company u
Shi Jiazhuang Meiling Electric 2nd Limited Shi
Sales 300.00 108.00 - 36.00 36.00 Yes 2,126,513.94 - -
Marketing Co., Ltd. (19) subsidiary Company Jiazhuang
Mianyang Meiling Electric Marketing 2nd Limited
Mianyang Sales 500.00 260.00 - 52.00 52.00 Yes 4,827,771.81 - -
Co., Ltd. (20) subsidiary Company
Chengdu Meiling Electric Marketing 2nd Limited
Chengdu Sales 500.00 417.00 - 83.40 83.40 Yes -86,070.33 830,000.00 -
Co., Ltd. (21) subsidiary Company
Guiyang Meiling Electric Marketing 2nd Limited
Guiyang Sales 300.00 78.00 - 26.00 26.00 Yes 2,337,715.42 - -
Co., Ltd. (22) subsidiary Company
Fuzhou Meiling Electric Marketing 2nd Limited
Fuzhou Sales 300.00 297.00 - 99.00 99.00 Yes 530.70 29,469.30 -
Co., Ltd. (23) subsidiary Company
Nanjing Meiling Electric Marketing 2nd Limited
Nanjing Sales 300.00 297.00 - 99.00 99.00 Yes -40,924.94 30,000.00 -
Co., Ltd. (24) subsidiary Company
Hefei Meiling White Apparatus 2nd Limited
Hefei Sales 600.00 510.00 - 85.00 85.00 Yes 562,595.50 337,404.50 -
Marketing Co., Ltd. (25) subsidiary Company
Taiyuan Meiling Electric Marketing 2nd Limited
Taiyuan Sales 400.00 159.00 - 39.75 39.75 Yes 2,647,071.55 - -
Co., Ltd. (26) subsidiary Company
121
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
The balance after
the parent
company’s owner’s
equity writing
Balance
down the excess of
Investme of other Amount in
State the current loss
nt items Holdi Voting minority
Registere ments undertaken by
amount materiall ng right Minority interest used
Registrati Business d capital combi minority
Name Rating Type at yforming propo propor interest for writing
on place nature (RMB’00 ned or shareholders of the
year-end net rtion tion down
00) not subsidiary over the
(RMB’00 investme (%) (%) minority
share enjoyed by
00) nt to gain and loss
minority
subsidiar
shareholders in the
y
original owner’s
equity of the
subsidiary
Changsha Meiling Electric Marketing 2nd Limited
Changsha Sales 500.00 180.00 - 36.00 36.00 Yes 3,348,764.75 - -
Co., Ltd. (27) subsidiary Company
Hollyhock Meiling Electric Marketing 2nd Limited
Hohhot Sales 300.00 165.00 - 55.00 55.00 Yes 1,417,667.95 - -
Co., Ltd. (28) subsidiary Company
Hangzhou Meiling Electric Marketing 2nd Limited
Hangzhou Sales 300.00 265.50 - 88.50 88.50 Yes -377,651.47 345,000.00 -
Co., Ltd. (29) subsidiary Company
Chongqing Meiling Electric Marketing 2nd Limited Chongqin
Sales 300.00 255.00 - 85.00 85.00 Yes 412,262.61 37,737.39 -
Co., Ltd. (30) subsidiary Company g
Kunming Meiling Electric Marketing 2nd Limited
Kunming Sales 300.00 139.50 - 46.50 46.50 Yes 356,865.96 1,248,134.04 -
Co., Ltd. (31) subsidiary Company
Shanghai Meiling Electric Marketing 2nd Limited
Shanghai Sales 300.00 297.00 - 99.00 99.00 Yes -58,869.81 30,000.00 -
Co., Ltd. (32) subsidiary Company
Nantong Meiling Electric Marketing 2nd Limited
Nantong Sales 300.00 174.00 - 58.00 58.00 Yes -299,761.85 1,260,000.00 -
Co., Ltd. (33) subsidiary Company
Neijiang Meiling Electric Marketing 2nd Limited
Neijiang Sales 300.00 240.00 - 80.00 80.00 Yes 773,799.28 - -
Co., Ltd. (34) subsidiary Company
Tianjin Meiling Electric Marketing Co., 2nd Limited
Tianjin Sales 300.00 256.50 - 85.50 85.50 Yes -43,202.12 435,000.00 -
Ltd. (35) subsidiary Company
Urumqi Meiling Electric Marketing 2nd Limited
Urumqi Sales 500.00 270.00 - 90.00 90.00 Yes 21,296.04 278,703.96 -
Co., Ltd. (36) subsidiary Company
Harbin Meiling Electric Marketing Co., 2nd Limited
Harbin Sales 300.00 108.00 - 36.00 36.00 Yes -2,021,577.78 1,920,000.00 -
Ltd. (37) subsidiary Company
Beijing Meiling Electric Marketing 2nd Limited
Beijing Sales 300.00 297.00 - 99.00 99.00 Yes 44,532.41 - -
Co., Ltd. (38) subsidiary Company
Lanzhou Meiling Electric Marketing 2nd Limited
Lanzhou Sales 300.00 121.50 - 40.50 40.50 Yes 2,212,457.70 - -
Co., Ltd. (39) subsidiary Company
Xi'an Meiling Electric Marketing Co., 2nd Limited
Xi'an Sales 300.00 183.00 - 61.00 61.00 Yes 633,609.06 536,390.94 -
Ltd. (40) subsidiary Company
Guangzhou Meiling Electric Marketing 2nd Limited Guangzho
Sales 500.00 430.00 - 86.00 86.00 Yes -206,194.99 700,000.00 -
Co., Ltd. (41) subsidiary Company u
122
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
The balance after
the parent
company’s owner’s
equity writing
Balance
down the excess of
Investme of other Amount in
State the current loss
nt items Holdi Voting minority
Registere ments undertaken by
amount materiall ng right Minority interest used
Registrati Business d capital combi minority
Name Rating Type at yforming propo propor interest for writing
on place nature (RMB’00 ned or shareholders of the
year-end net rtion tion down
00) not subsidiary over the
(RMB’00 investme (%) (%) minority
share enjoyed by
00) nt to gain and loss
minority
subsidiar
shareholders in the
y
original owner’s
equity of the
subsidiary
Jinan Meiling Electric Marketing Co., 2nd Limited
Jinan Sales 300.00 108.00 - 36.00 36.00 Yes 1,479,999.07 440,000.93 -
Ltd. (42) subsidiary Company
Subsidiaries obtained through business combination under the same control
Manufact
Sichuan Changhong Air-conditioners Limited
Subsidiary Mianyang uring and 20,000.00 30,560.00 - 100.00 100.00 Yes - - -
Co., Ltd. (43) Company
sales
Manufact
Zhongshan Changhong Electric Co., Limited
Subsidiary Zhongshan uring and 8,000.00 7,625.00 - 90.00 100.00 Yes - - -
Ltd. (44) Company
sales
Subsidiaries obtained through business combination under the different control
Limited Holding
Hefei Meiling Group Holding Co., Ltd.(45) Subsidiary Hefei 8,000.00 11,363.00 - 100.00 100.00 Yes - - -
Company Company
Manufact
Meiling Yingkaite Appliance (Hefei) Co., 2nd Limited
Hefei uring and 2,479.31 1,859.49 - 100.00 100.00 Yes - - -
Ltd.(46) subsidiary Company
sales
Manufact
2nd Limited
Hefei Yingkaite Apparatus Co., Ltd. (47) Hefei uring and 1,200.00 867.06 - 100.00 100.00 Yes - - -
subsidiary Company
sales
Manufact
Meiling Non-ferrous Metal Products Co., 2nd Limited
Hefei uring and 2,428.68 2,199.64 - 100.00 100.00 Yes - - -
Ltd. (48) subsidiary Company
sales
Manufact
2nd Limited
Hefei Meiling Precision Tube Co., Ltd. (49) Hefei uring and 100.00 80.00 - 100.00 100.00 Yes - - -
subsidiary Company
sales
Manufact
Hefei Meiling Package Products Co., 2nd Limited
Hefei uring and 1,740.00 952.00 - 51.72 100.00 Yes - - -
ltd.(50) subsidiary Company
sales
123
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
The balance after
the parent
company’s owner’s
equity writing
Balance
down the excess of
Investme of other Amount in
State the current loss
nt items Holdi Voting minority
Registere ments undertaken by
amount materiall ng right Minority interest used
Registrati Business d capital combi minority
Name Rating Type at yforming propo propor interest for writing
on place nature (RMB’00 ned or shareholders of the
year-end net rtion tion down
00) not subsidiary over the
(RMB’00 investme (%) (%) minority
share enjoyed by
00) nt to gain and loss
minority
subsidiar
shareholders in the
y
original owner’s
equity of the
subsidiary
Manufact
Hefei Meiling Environment-friendly 2nd Limited
Hefei uring and 80.00 64.00 - 100.00 100.00 Yes - - -
Package Materials Co., Ltd. (51) subsidiary Company
sales
Hefei Meiling Appliance 2nd Limited
Hefei Sales 500.00 300.00 - 100.00 100.00 Yes - - -
Industy&Commerce Co., Ltd. (52) subsidiary Company
2nd Limited
Hefei Maston Appliance Co., Ltd (53) Hefei Sales 398.00 485.97 - 100.00 100.00 Yes - - -
subsidiary Company
Chaohu Meiling Electric Marketing 2nd Limited
Chaohu Sales 500.00 254.75 - 50.00 50.00 Yes 3,363,538.93 - -
Co., Ltd. (54) subsidiary Company
Note: “Investment amount at period-end” and “holding proportion” listed aboved refers to the amount and shares that directly invested and held by the parent company of the
above said company;”Voting right proportion” refers to the total of proportion hold directly and indirectly by the Company.
124
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
(1) Zhongke Meiling Cryogenics Co., Ltd. (hereinafter referred to as Zhongke Meiling Company)
was established on Oct. 29, 2002 by the company and CAS’s Physical & Chemical technology
Research, whose registered capital was RMB60, 000,000 including material contribution of RMB
35,573,719.70 which accounted for 70% of registered capital and cash contribution of RMB
6,426,280.30. CAS’s Physical & Chemical technology Research made contributions by New mixed
throttle refrigeration technology and technical License of Application research in super low
temperature storage box that was appraised RMB 18,000,000 accounting for 30% of registered
capital. The actual received of the register capital have been verified by verification report of
[Huazheng Yanzi No.(2002) B157] issued by Huazheng CPAs Co., Ltd..
Registration No. of the Business License of Corporation Legal Person: 3401001006416;
organization code: 74309835-2; Legal Representative: Wang Yong; Address: Meiling Economy
Development Zone, Feidong Longgang, Hefei City. Business Scope: R & D, exploitation,
manufacture, sales and service of cryogenic cooling equipment and products; self-operating and
agency for the import&export business of various commerce and technology.
(2) Jiangxi Meiling Refrigeration Co., Ltd. (Jingxi Meiling Refrigeration Co.,), a company jointly
set up by the Company and China-tech Meiling Company, was founded on Nov. 6, 2007. Its
registered capital was RMB 20 million upon establishment, of which, the Company invested RMB
18,000,000, accounting for 90% of the registered capital; while China-tech Meiling Company
invested RMB 2,000,000, accounting for 10% of the registered capital. On Dec. 10, 2008, Jiangxi
Meiling Company increased its capital and shares, after which, its registered capital and paid-in
capital were changed to RMB 40 million, including the cash investment of RMB 45 million from
the Company, among which RMB 36 million was input as registered capital, accounting for 90% of
the registered capital, and RMB 9 million was recorded into capital reserve of Jiangxi Meiling
Company; and China-tech Meiling Company invested cash RMB 5 million, among which RMB 4
million was input as registered capital, accounting for 10% of the registered capital and RMB 1
million was recorded into capital reserve of Jiangxi Meiling Company. The procedures for
registration of its change in registered capital in the Industry and Commerce Administration Bureau
were completed in 2008. The above mentioned capital-increased have been verified by [Gangjingde
Yanzi No.(2008) 354] issued by Jiangxi Jingde CPAs Co., Ltd. In 2011, Zhongke Meiling entered
into “Equity Transfer Agreement” with Mianyang Meiling Refrigeration Co., Ltd. 10 percent equity
of Jiangxi Meiling held by Zhongke Meiling was transferred to Mianyang Meiling Refrigerator.
Relevant changes for Industrial and Commercial was done dated 2 November 2011.
Registration No. of the Business License of Corporation Legal Person: 360200110000441;
organization code: 66748284-5; Address: No.558 Cidu Road, Jingde Town City; Legal
Representative: Li Daijiang; Business Scope: R & D, manufacture and sales of cooling apparatus,
electronic products and other fittings.
(3) Mianyang Meiling Refrigeration Co., Ltd. (hereinafter referred to as Mianyang Meiling
Company), a limited liability company jointly set up by the Company and China-tech Meiling
Company, was founded on Mar. 6, 2009. Its registered capital and paid-in capital was RMB 50
million upon establishment, of which, the Company invested RMB 45 million, accounting for 90%
of the registered capital; Zhongke Meiling Company invested RMB 5 million, accounting for 10%
of the registered capital. The capital receipt was verified by the verification report [CXKY (2009)
No. 008] of Sichuan Xingrui Certified Public Accountants. On 19 January 2011, the Company
increase RMB 50 million in capital of Mianyang Meiling, paid-in capital has been verified by
Capital Verification Report ［XYZH/2010CDA6040］from Chengdu Branch of Shinewing CPA CO.,
Ltd. Currently register capital and paid-in capital of Mianyang Meiling amounting to RMB 100
125
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
million; of which RMB 95 million invested by the Company, a 95% of total register capital while
RMB 5 million invested by Zhongke Meiling, a 5% of total capital occupied. In 2011, Zhongke
Meiling entered into “Equity Transfer Agreement” with Jiangxi Meiling Refrigeration Co., Ltd. 5
percent equity of Mianyang Meiling held by Zhongke Meiling was transferred to Jiangxi Meiling
Refrigerator. Changes for Industrial and Commercial registration completed on 18 November 2011.
Registration No. of the Business License of Corporation Legal Person: 510706000014939;
organization code: 68610561-5; Address: No.35 Mianxing East Road, Gaoxin District, Mianyang
City, Sichuan Province; Legal Representative: Li Daijiang; Business Scope: R & D, manufacture
and sales of cooling apparatus, electronic products and other fittings.
(4) Hefei Meiling Appliance Marketing Co., Ltd. (hereinafter referred to as Meiling Marketing
Company), a limited liability company jointly set up by the Company and Mianyang Meiling
Company, was founded on Oct. 21, 2009. Its registered capital and paid-in capital was RMB 10
million upon establishment, of which, the Company invested RMB 9.90 million, accounting for
99% of the registered capital, and Mianyang Meiling Company invested RMB 0.10 million,
accounting for 1% of the registered capital. The registered capital receipt was verified by the
verification report [WALXDYZ (2009) No. 074] of Anhui Anlian Xinda Certified Public
Accountants Co., Ltd. On November 25, 2010, RMB 45 million increased by the Japan Company,
the register capital came to RMB 55 million. Among which, RMB 54.9 million from the Company,
account 99.82% of the register capital while RMB0.1 million from Mianyang Meiling, account
0.18% of the register capital. The above mentioned capital-increased have been verified by
[Wanhuashen Zhengdakuai Yanzi No.(2010) 1514] issued by Anhui Huashen Zhengda CPAs Co.,
Ltd.
Registration No. of the Business License of Corporation Legal Person: 340107000030092;
organization code: 69573778-8; Address: Woyun Road North, Lianhua Road East, Economy and
Technology Development Zone, Hefei ; Legal Representative: Wang Yong; Business Scope:
Refrigeration appliances, air conditioners, washing machines, computer numerically controlled
injection moulding machine, computer water heaters, plastic products, packaging materials and
accessories, electronic products and accessories, general merchandise sales
(5) Jiangxi Meiling Appliance Co., Ld.(Jiangxi Meiling Appliance Co.,) was a limited liability
company jointly established by the Company and Mianyang Meiling on 23 May 2011. Register
capital of the company totally as RMB 50 million, RMB 49.375 million invested by the Company,
98.75% in total register capital while RMB 0.625 million invested by Mianyang Meiling , a 1.25%
in total register capital occupied. The initial investment RMB 10.50 million was received dated 13
May 2011 with RMB 10 million from the Company and RMB 0.5 million from Mianyang Meiling.
Rest of the capital shall be invested fully within 2 years after the joint ventures established
according to capital requirement. The initial investment capital were verified by the Capital
Verification Report [JXKYZi(2011) No. 090] issued from Jingdezhen Xingci CPA Co., Ltd.
Registration No. of the Business License of Corporation Legal Person: 360200110004455;
organization code: 57364516-4; Address: South part of Wutong Revenue, High-Tech Industrial
Development District, Jingdezhen; Legal Representative: Wang Yong; Business Scope: R&D,
manufacturing and sales of refrigerator and its accessories.
(6) Changhong Ruba Trading Company (Private) Limited (Changhong Ruba), was a joint-venture
jointly established by Zhongshan Changhong Appliance Co., Ltd. and UAE RUBA GENERAL
TRADING FZE( UAE RUBA), which has been approved in “Reply of Approval of Manufacture
126
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
and sales platform jointly established in Pakistan by Zhongshan Changhong Appliance Co.,
Ltd.”[YFGWZ(2011) No.:958] from Guangdong Development & Reform Commission dated 5
August 2011. The company owes register capital of USD 3 million with USD 1.8 million invested
from Zhongshan Changhong Appliance Co., Ltd. in cash, 60% of shares held while UAE RUBA
invested USD 1.2 million with 40% shares held. The company registered in Lahore Pakistan, legal
representative: Du Zhixiao; Business scope: sales of air-conditioner and other household apparatus.
(7) Xinxiang Meiling Appliance Marketing Co., Ltd. (Xinxiang Meiling) was established dated 17
May 2010 with organization code of No. 555723050; register capital amounting to RMB 3.5 million
with RMB 2.065 million invested by Meiling Marketing, a 59% in total register capital; address and
business office: 1#, 21/F, Tower B, Hengshen Shijia, No.6, Baojian Rd.; legal representative: Qin
Tangzong; business scope: wholesale and retails of household apparatus.
(8) Luohe Meiling Appliance Marketing Co., Ltd. (Luohe Meiling) was established dated 10
December 2010 with organization code of No. 566483064; register capital amounting to RMB 5
million with RMB 1.85 million invested by Meiling Marketing, a 37% in total register capital;
address and business office: Middle section, Yellow Rive Rd., Yancheng District, Luohe City; legal
representative: Guo Gang; business scope: sales and maintenance of refrigerator machine,
air-conditioner, TV set, washing machine, injection machine of computer control, digital products,
computer heater, plastic products, packaging products, decorations, electronic products and
accessories, daily necessaries and household apparatus.
(9) Wuhu Meiling Appliance Marketing Co., Ltd.(Wuhu Meiling) was established on December 24, 2010
with organization code of No. 567508470; register capital amounting to RMB 6 million with RMB
2.16 million invested by Meiling Marketing, a 36% in total register capital; address and business
office: No. 1002, Qiaohong International Commercial Town, Jinhu District, Wuhu City; Legal
representative: Cui Lianbin; Business scope: sales and maintenance of household apparatus.
(10) Changchun Meiling Appliance Marketing Co., Ltd. (Changchun Meiling) was established on
December 22, 2010 with organization code of No. 563926181; register capital amounting to RMB 3
million with RMB 2.91 million invested by Meiling Marketing, a 97% in total register capital;
address and business office: 301 South part, No. 21, Ximinzhu Street, Chaoyang District,
Changchun City; Legal representative: Tang Yiliang; Business scope: sales and maintenance of
refrigerator machine, air-conditioner, TV set, washing machine, injection machine of computer
control, digital products, computer heater, plastic products, packaging products, decorations,
electronic products and accessories, general merchandise and household apparatus.
(11) Bengbu Meiling Appliance Marketing Co., Ltd. (Bengbu Meiling) was established on December 27,
2010 with organization code of No. 567509043; register capital amounting to RMB 3 million with
RMB 2.55 million invested by Meiling Marketing, a 85% in total register capital; address and
business office: East Room, 16/F, East part of Office building, 9/F-18/F, New Century Plaza, No.
1028 Huihe Rd., Bengbu City; Legal representative: Cui Lianbin; Business scope: sales and
maintenance of refrigerator machine, air-conditioner, TV set, washing machine, injection machine
of computer control, digital products, computer heater, plastic products, packaging products,
decorations, electronic products and accessories, general merchandise and household apparatus.
(12) Hengyang Meiling Appliance Marketing Co., Ltd. (Hengyang Meiling) was established on
December 24, 2010 with organization code of No. 567652288; register capital amounting to RMB 3
million with RMB 1.08 million invested by Meiling Marketing, a 36% in total register capital;
127
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
address and business office: No. 302, Yujia Community, Yujia Group, Jiangdong Village, Zhuhui
District, Hengyang City; Legal representative: Zu Pu; Business scope: refrigerator machine,
air-conditioner, TV set, washing machine, injection machine of computer control, digital products,
computer heater, plastic products, packaging products, decorations, electronic products and
accessories and sales of general merchandise.
(13) Nanchang Meiling Appliance Marketing Co., Ltd. (Nanchang Meiling) was established on 5 January
2011 with organization code of No. 566294036; register capital amounting to RMB 3 million with
RMB 1.08 million invested by Meiling Marketing, a 36% in total register capital; address and
business office: No. 192, Gaoxin 7# Rd., Gaoxin District, Nanchang City; Legal representative: Zu
Pu; Business scope: wholesale and retails of refrigerator machine, air-conditioner, TV set, washing
machine, injection machine of computer control, digital products, computer heater, plastic products,
packaging products, decorations, electronic products and accessories, general merchandise and
maintenance of household apparatus.
(14)Liu’an Meiling Appliance Marketing Co., Ltd. (Liu’an Meiling) was established on 13 January 2011
with organization code of No. 56753250X; register capital amounting to RMB 5 million with RMB
1.80 million invested by Meiling Marketing, a 36% in total register capital; address and business
office: Management Committee Building, Jinsan Rd., Economic & Development District, Liu’an
City; Legal representative: Cui Lianbin; Business scope: wholesale and retails of refrigerator
machine, air-conditioner, TV set, washing machine, injection machine of computer control, digital
products, computer heater, plastic products, packaging products, decorations, electronic products
and accessories, general merchandise, marketing and after-sell service of household apparatus;
maintenance of household apparatus.
(15)Jinzhou Meiling Appliance Marketing Co., Ltd. (Jinzhou Meiling) was established on 10 January 2011
with organization code of No. 565495194; register capital amounting to RMB 4 million with RMB
1.60 million invested by Meiling Marketing, a 40% in total register capital; address and business
office:No.2, 2/F, 1# door, 13 Building, (Rongxin Garden), Beijing East Rd., Shashi District; Legal
representative: Zu Pu; Business scope: refrigerator machine, air-conditioner, TV set, washing
machine, injection machine of computer control, digital products, computer heater, plastic products,
packaging products, decorations, electronic products and accessories, sales of general merchandise;
maintenance of household apparatus.
(16)Shenyang Meiling Appliance Marketing Co., Ltd. (Shenyang Meiling) was established on 26 January
2011 with organization code of No. 564699988; register capital amounting to RMB 3 million with
RMB 2.844 million invested by Meiling Marketing, a 94.80% in total register capital; address and
business office:No.30, Renao Rd., Shenhe District, Shenyang City; Legal representative: Tang
Yiliang; Business scope: household apparatus, refrigerator machine, injection machine of computer
control and sales of general merchandise.
(17)Wuhan Meiling Appliance Marketing Co., Ltd. (Wuhan Meiling) was established on 10 January 2011
with organization code of No. 565593579; register capital amounting to RMB 5 million with
RMB4.55 million invested by Meiling Marketing, a 91% in total register capital; address and
business office:15/F, Taihe Plaza, No.72 Wusheng Rd., Qiaokou District, Wuhan City; Legal
representative: Zu Pu; Business scope: refrigerator machine, air-conditioner, washing machine,
electronic products and accessories and sales of general merchandise.
(18)Zhengzhou Meiling Appliance Marketing Co., Ltd. (Zhengzhou Meiling) was established on 17
128
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
January 2011 with organization code of No. 568607614; register capital amounting to RMB 3 million
with RMB 1.08 million invested by Meiling Marketing, a 36% in total register capital; address and
business office:No.15, 5/F, No.18 Chengdong Rd. East, Guancheng District, Zhengzhou City; Legal
representative: Guo Gang; Business scope: sales of refrigerator machine, air-conditioner, TV set,
washing machine, injection machine of computer control, digital products, computer heater, plastic
products, packaging products & decorations, electronic products and accessories, general
merchandise and maintenance of household apparatus.
(19)Shijiazhuang Meiling Appliance Marketing Co., Ltd. (Shijiazhuang Meiling) was established on 14
January 2011 with organization code of No. 56891178X; register capital amounting to RMB3 million
with RMB 1.08 million invested by Meiling Marketing, a 36% in total register capital; address and
business office:No.669, Chengjiao Street South, Qiaoxi District, Shijiazhuang City; Legal
representative: Tang Yiliang; Business scope: refrigerator machine, air-conditioner, TV set, washing
machine, injection machine of computer control, digital products, computer heater, plastic products,
packaging products, art & crafts products, electronic products and accessories, sales of general
merchandise; maintenance of household apparatus.
(20)Mianyang Meiling Appliance Marketing Co., Ltd. (Mianyang Meiling) was established on 27 January
2011 with organization code of No. 567642821; register capital amounting to RMB 5 million with
RMB 2.6 million invested by Meiling Marketing, a 52% in total register capital; address and
business office: Commercial & Trade Plaza, Gaoxin District, Mianyang; Legal representative: Fang
Rongxin; Business scope: sales and maintenance of household apparatus, general merchandise and
electronic products.
(21) Chengdu Meiling Appliance Marketing Co., Ltd. (Chengdu Meiling) was established on 26 January
2011 with organization code of No. 567191530; register capital amounting to RMB 5 million with
RMB 4.07 million invested by Meiling Marketing, a 81.40% in total register capital; address and
business office:No.22, Shuangfeng West Rd., Wuhou District, Chengdu City; Legal representative:
Fang Rongxin; Business scope: sales of refrigerator machine, air-conditioner, household apparatus,
digital products, heater, plastic products, art & crafts products, electronic products and accessories,
general merchandise; maintenance of household apparatus.
(22)Guiyang Meiling Appliance Marketing Co., Ltd. (Guiyang Meiling) was established on 24 January
2011 with organization code of No. 569205772; register capital amounting to RMB 3 million with
RMB 0.78 million invested by Meiling Marketing, a 26% in total register capital; address and
business office:No.16-3, Pubu Business Building, No. 19 Yan’an West Rd., Yunyan District,
Guiyang City; Legal representative: Fang Rongxin; Business scope: sales of refrigerator machine,
air-conditioner, TV set, washing machine, injection machine of computer control, digital
products(previously permit excluded) , computer heater, plastic products, packaging products, art &
crafts products, electronic products (previously permit excluded)and accessories, sales of general
merchandise; maintenance of household apparatus.
(23)Fuzhou Meiling Appliance Marketing Co., Ltd. (Fuzhou Meiling) was established on 25 January 2011
with organization code of No. 569281679; register capital amounting to RMB 3 million with RMB
2.97 million invested by Meiling Marketing, a 99% in total register capital; address and business
office:05, 22/F, Jin’an Building, Jinyuan Garden, No. 328 Liuyi North Rd., Ji’an District, Fuzhou
City; Legal representative: Zu Pu; Business scope: refrigerator machine, air-conditioner, TV set,
washing machine, injection machine of computer control, digital products , computer heater, plastic
products, packaging products, art & crafts products, electronic products and accessories, sales of
129
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general merchandise; maintenance of household apparatus.
(24)Nanjing Meiling Appliance Marketing Co., Ltd. (Nanjing Meiling) was established on 14 February
2011 with organization code of No. 567226780; register capital amounting to RMB 3 million with
RMB 2.97 million invested by Meiling Marketing, a 99% in total register capital; address and
business office:14/F, Dongheng International Business Building, No. 288 Zhongshan South Rd.,
Baixia District, Nanjing City ; Legal representative: Qin Tangzong; Business scope: refrigerator
machine, air-conditioner, TV set, washing machine, injection machine of computer control,
computer heater, plastic products, packaging products and decorations, electronic products and
accessories, sales of general merchandise, TV and digital products; maintenance of household
apparatus.
(25)Hefei Meiling White Apparatus Marketing Co., Ltd. (White Apparatus) was established on 21
January 2011 with organization code of No. 568971344; register capital amounting to RMB 6 million
with RMB 5.10 million invested by Meiling Marketing, a 85% in total register capital; address and
business office:A-201, Huayi Science & Technology Park, Gaoxin District, Hefei City; Legal
representative: Qin Tangzong; Business scope: refrigerator machine, air-conditioner, TV set,
washing machine, digital products, computer heater, plastic products, packaging products and
decorations, electronic products and accessories, sales of household apparatus and maintenance of
household apparatus.
(26)Taiyuan Meiling Appliance Marketing Co., Ltd. (Taiyuan Meiling) was established on 18 January 2011
with organization code of No. 568472262; register capital amounting to RMB 4 million with
RMB1.59 million invested by Meiling Marketing, a 39.75% in total register capital; address and
business office:6/F, Hanyuan Building, Qinxian North Street, Xiaodian District, Taiyuan City; Legal
representative: Tang Yiliang; Business scope: refrigerator machine, household apparatus, injection
machine of computer control, digital products , plastic products, packaging products and
decorations, sales of electronic products and accessories and general commodities; maintenance of
household apparatus.
(27)Changsha Meiling Appliance Marketing Co., Ltd. (Changsha Meiling) was established on 26 January
2011 with organization code of No. 567688918; register capital amounting to RMB 5 million with
RMB 1.80 million invested by Meiling Marketing, a 36% in total register capital; address and
business office: Room 301, Oriental Ginza, No. 348 Yuanda No.1 Rd., Furong District, Changsha
City; Legal representative: Zu Pu; Business scope: refrigerator machine, washing machine, injection
machine of digital control, heater , plastic products, electrics outer packaging products and
decorations, sales of electronic products and accessories and general commodities.
(28)Hohhot Meiling Appliance Marketing Co., Ltd. (Hohhot Meiling) was established on 21 February 2011
with organization code of No. 566949493; register capital amounting to RMB 3 million with RMB
1.65 million invested by Meiling Marketing, a 55% in total register capital; address and business
office: No. 516, 4/F, Comprehensive Building, Jiangjun Garden, No. 139 Dongku Street, Xincheng
District, Hohhot City; Legal representative: Tang Yiliang; Business scope: sales of refrigerator
machine, electronic products, hardware and AC, air-conditioner equipment, digital products, plastic
products, general commodities , packaging products and decoration materials; sales and
maintenance of household apparatus.
(29) Hangzhou Meiling Appliance Marketing Co., Ltd. (Hangzhou Meiling) was established on 17
February 2011 with organization code of No. 568772548; register capital amounting to RMB 4
130
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million with RMB 2.655 million invested by Meiling Marketing, a 88.50% in total register capital;
address and business office: Room 609, 1# building, Nanbei Shangwugang, Gongshu District,
Hangzhou City; Legal representative: Zhou Wenhui; Business scope: sales of household apparatus,
refrigerator machine, plastic products, decoration materials, art products, electronic products,
injection machine with digital control and general merchandise; maintenance of household
apparatus.
(30) Chongqing Meiling Appliance Marketing Co., Ltd. (Chongqing Meiling) was established on 1
March 2011 with organization code of No. 569914835; register capital amounting to RMB 3 million
with RMB 2.55 million invested by Meiling Marketing, a 85% in total register capital; address and
business office: No. 105, No. 106 and No.111, Dayang Gongqiao, Shapingba District, Chongqing
City; Legal representative: Fang Rongxin; Business scope: wholesale and retails of refrigerator
machine, air-conditioner, TV set, washing machine, injection machine with computer control,
digital products, computer heater, plastic products, packaging products and decorations, electronic
products and accessories(electronic publisher excluded), general commodities (agriculture film
excluded); maintenance of household apparatus.
(31) Kunming Meiling Appliance Marketing Co., Ltd. (Kunming Meiling) was established on 28
February 2011 with organization code of No. 568819406; register capital amounting to RMB 3
million with RMB 1.395 million invested by Meiling Marketing, a 46.50% in total register capital;
address and business office:6/F, No. 13 Longquan Rd., Kunming City; Legal representative: Fang
Rongxin; Business scope: sales of household apparatus and general commodities.
(32) Shanghai Meiling Appliance Marketing Co., Ltd. (Shanghai Meiling) was established on 9 March
2011 with organization code of No. 569647714; register capital amounting to RMB 3 million with
RMB 2.97 million invested by Meiling Marketing, a 99% in total register capital; address and
business office: A Room 201-9, No. 15, 152 Lane, Yanchang Rd., Shanghai City; Legal
representative: Zhou Wenhui; Business scope: sales of household apparatus, machinery equipment,
digital products, plastic products, craft products, packaging materials, electronic products and its
accessories and general merchandise; maintenance of household apparatus.
(33) Nantong Meiling Appliance Marketing Co., Ltd. (Nantong Meiling) was established on 8 March
2011 with organization code of No. 570386216; register capital amounting to RMB 3 million with
RMB 1.75 million invested by Meiling Marketing, a 58% in total register capital; address and
business office: Room 2207, 1# Wangfu Building, No. 6 Renmin East Rd., Nantong City; Legal
representative: Zhou Wenhui; Business scope: sales and maintenance of refrigerator machine,
air-conditioner, washing machine, injection machine with computer control, digital products,
computer heater, plastic products, packaging products and decorations, electronic products and
accessories and general commodities.
(34) Neijiang Meiling Appliance Marketing Co., Ltd. (Neijiang Meiling) was established on 8 March
2011 with organization code of No. 570707198; register capital amounting to RMB 3 million with
RMB 2.4 million invested by Meiling Marketing, a 80% in total register capital; address and
business office: middle layer, No. 386 Yuxi Rd., Zhong District, Neijiang City; Legal representative:
Fang Rongxin; Business scope: wholesales and retails of refrigerator machine, air-conditioner,
washing machine, injection machine with computer control, computer heater, plastic products,
packaging products and decorations, electronic products and accessories and general commodities;
maintenance of household apparatus.
131
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(35) Tianjin Meiling Appliance Marketing Co., Ltd. (Tianjin Meiling) was established on 2 March 2011
with organization code of No. 569324093; register capital amounting to RMB 3 million with RMB
2.565 million invested by Meiling Marketing, a 85.5% in total register capital; address and business
office: middle layer, No. 3001-96, economy and development centre, No. 9 Junling Rd., Electronic
Industrial Park, North Gate, Jinnan District; Legal representative: Tang Yiliang; Business scope:
wholesales of household apparatus, injection machine with computer control, plastic products,
packaging products, electronic products and accessories and general commodities; maintenance of
household apparatus.
(36) Urumchi Meiling Appliance Marketing Co., Ltd. (Urumchi Meiling) was established on 4 March
2011 with organization code of No. 56887356-8; register capital amounting to RMB 3 million with
RMB 2.7 million invested by Meiling Marketing, a 90% in total register capital; address and
business office: Room 505, Yinzuo Centre, No. 196 Tianjin South Rd., Urumchi City; Legal
representative: Fang Rongxin; Business scope: sales and maintenance of household apparatus,
hardware and AC, electronic products and machinery equipments.
(37) Harbin Meiling Appliance Marketing Co., Ltd. (Harbin Meiling) was established on 6 April 2011
with organization code of No. 571906754; register capital amounting to RMB 3 million with RMB
1.08 million invested by Meiling Marketing, a 36% in total register capital; address and business
office: No.4, Hengshan Rd., Nangang Centre District, Jinkai Zone, Harbin City; Legal
representative: Tang Yiliang; Business scope: sales of household apparatus, office automation
equipment, electronic equipment, packaging products and plastic products as well as relevant
technology service.
(38) Beijing Meiling Appliance Marketing Co., Ltd. (Beijing Meiling) was established on 28 March 2011
with organization code of No. 573245005; register capital amounting to RMB 3 million with RMB
3.97 million invested by Meiling Marketing, a 99% in total register capital; address and business
office: No.23, Xinhua West Street, Majuqiao Town, Tongzhou District, Beijing; Legal
representative: Qin Tangzong; Business scope: sales of household apparatus, computer software and
assistant equipments, daily grocery, electronic products, general equipments, specific equipments;
maintenance of household apparatus.
(39)Lanzhou Meiling Appliance Marketing Co., Ltd. (Lanzhou Meiling) was established on 25 March 2011
with organization code of No. 571608108; register capital amounting to RMB 3 million with RMB
1.215 million invested by Meiling Marketing, a 40.5% in total register capital; address and business
office: No. 134, Jiayuguan West Rd., Chengguan District, Lanzhou City ; Legal representative:
Fang Rongxin; Business scope: retails and wholesale of refrigerator machine, air-conditioner, TV
set, washing machine, injection machine of computer control, digital products, computer heater,
plastic products, electronic products and accessories and general merchandise; maintenance of
household apparatus.
(40)Xi’an Meiling Appliance Marketing Co., Ltd. (Xi’an Meiling) was established on 13 April 2011 with
organization code of No. 570227776; register capital amounting to RMB 3 million with RMB 1.83
million invested by Meiling Marketing, a 61% in total register capital; address and business
office:No.10715, 7/F, 1 Unit, #12 Building, Xinxing Junjin Garden, No. 369 Jinhua Rd., Xincheng
District, Xi’an City ; Legal representative: Fang Rongxin; Business scope: sales and maintenance of
refrigerator machine, air-conditioner, TV set, washing machine, injection machine of computer
control, digital products, computer heater, plastic products, packaging and decorations, electronic
products and accessories and general merchandise; maintenance of household apparatus.
132
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(41)Guangzhou Meiling Appliance Marketing Co., Ltd. (Guangzhou Meiling) was established on 13 May
2011 with organization code of No. 574044061; register capital amounting to RMB 5 million with
RMB 4.3 million invested by Meiling Marketing, a 86% in total register capital; address and
business office: 2/F, No. 98 Tanxin Street, Dongheng Rd., Baiyun District, Guangzhou City; Legal
representative: Zu Pu; Business scope: wholesales and maintenance of refrigerator machine,
electronic products and accessories, plastic injection machine, general merchandise and plastic
products.
(42) Jinan Meiling Appliance Marketing Co., Ltd. (Jinan Meiling) was established on 3 June 2011 with
organization code of No. 575560578; register capital amounting to RMB 5 million with RMB 1.08
million invested by Meiling Marketing, a 36% in total register capital; address and business office:
No.249, Huangqiao Industry Park, Donglihe West Rd., Tianqiao District, Jinan City; Legal
representative: Qin Tangzong; Business scope: wholesales & retails and maintenance of household
apparatus, electronic products and accessories; wholesales and retails of general merchandise and
plastic products.
(43) Sichuan Changhong Air-conditioners Co., Ltd.(Changhong Air-conditioner for short), a limited
liability company jointly set up by Sichuan Changhong and Changhong Chuangtou, was founded on
November 28, 2008. Its registered capital was RMB 200 million upon establishment, of which,
Sichuan Changhong invested RMB 298 million (RMB 210,088,900 invested by monetary capital
while RMB 87,911,100 invested by real material), equivalent to RMB 198 million shares,
accounting for 99% of the registered capital; and Changhong Chuangtou invested RMB 3 million,
accounting for 1% of the registered capital with equivalent of RMB 2 million shares. The registered
capital receipt was verified by the verification report [CGYYZ (2008) No. 177] of Sichuan
Guangyuan Certified Public Accountants Co., Ltd. and [HLTHYZ(2008) No. 12-006] of Sichuan
Henglitai Certified Public Accountants Co., Ltd. In December 2009, the Company obtained 100%
equity of Changhong Air-conditioner by consolidated under the same control.
Registration No. of the Business License of Corporation Legal Person: 510706000013788;
organization code of No. 68236997-1; Address: No.35, Mianxing East Road, Gaoxin District,
Mianyang City; Legal Representative: Wang Yong; Business Scope: R&D, manufacturing, sales and
after-sales services of air conditioners and parts, external processing services of spare parts, and
sales of metal materials (excluding gold and silver)
(44) Zhongshan Changhong Electric Co., Ltd.( Zhongshan Changhong for short), was the original
Guangdong Changhong Electric Co., Ltd., and is a limited liability company jointly set up by
Sichuan Changhong and China Minmetals on May 22, 2001. Its registered capital was RMB 80
million upon establishment, of which, Sichuan Changhong invested RMB 72 million, including
RMB 69.3 million biding for the estate/ non-estate from original Zhongshan Sanrong
Air-conditioner Co., Ltd. And its patent use-right of RMB2.7 million, accounting for 90% of the
registered capital; Chine Minmetals invested RMB 8 million in monetary capital accounting 10% of
the registered capital. The Company changed its name originally from Guangdong Changhong
Electric Co., Ltd in July 2003. In December 2009, the Company obtained 90% equity of Zhongshan
Changhong by consolidated under same control. 10% equity held by China Minmetals has been
transferred by Changhong Air-conditioner on April 11, 2010.
Registration No. of the Business License of Corporation Legal Person: 442000000290879;
organization code of No. 728773292; Address: Central Nantou Avenue, Nantou Town, Zhongshan
133
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(Unlessotherwisespecified.RMBforrecordinthestatement)
City; Legal Representative: Li Jin; Business Scope: Mainly engaged in production, processing, sale
of air conditioners, television sets, laser disc players, audio equipments, computers and spare parts
of these products.
(45) Hefei Meiling Group Holding Co., Ltd (Meiling Group for short), was the state-owned company
originally approved by People’s Government of Hefei Province and established authorized by SASAC of
Hefei City. On July 14, 2008, 100% state-owned equity of Meiling Group has freely transferred to
Xingtai Holding by Hefei SASAC. Agreement by the approval of < State-owned property
agreement transfer from Meiling Group> [ HGZCQ(2010) No.34] of Hefei SASAC on April 9,
2010, 100% state-owned property of Meiling Group after partial assets and liabilities separated
transferred to the Company from Xingtai Holding as amount of RMB 113.2 million. The
re-registration of industrial and commercial procedure for Meiling Group after separated partial
assets liability has finished on July 28, 2010. The new Meiling Group has register capital of RMB
80 million, and have been verified by the [AD(2010)YZD No. 016] from Anhui Anding CPAs Co.,
Ltd.
Registration No. of the Business License of Corporation Legal Person: 340100000010841;
organization code of No.14918553-3; Address: Main plant of 2# South, Tangkou Road, Lianhua
Road East, Economy&Technology Development Zone, Hefei; Legal Representative: Wang Jiazhang;
Business Scope: Manufacture of washing machine, plastic products, fine welded pipe, cooling fittings,
package products and decoration products; Self-produced products and raw&auxilary materials, machinery
equipment, instrument and department sales.
(46) Meiling Yingkaite Appliance (Hefei) Co., Ltd.( Yingkaite Appliance for short) was the sino-foreign
joint venture jointly set up by original Meiling Group and EQUATOR INVESTMENTS (USA)
INC.( EQUATOR for short), which have been approved by the [SWZWFZZ(2004) No.0103] of
Approval Certificate of Foreign Enterprise from People’s Government of Anhui Province. Its
registered capital was US$ 3 million upon establishment, of which, sino company invested
US$ 2.25 million in machinery equipment, accounting 75% of the registered capital while foreign
company invested US$ 0.5 million in monetary capital and US$ 0.25 million in intangible assets,
amounting to US$0.75 million, accounting 25% of the registered capital. The above mentioned
investment verified by the verification report of [WYAYZ (2004) No. 135] from Anhui Yongan
CPAs Co., Ltd. In July 2007, approved by [HWJ(2007) No.136] from Foreign Trade Economic
Cooperation Bureau of Hefei City, 25% equity held by EQUATOR transferred to Anhui Meiling
Electric Co., Ltd. Totally. The Company’s register capital came into RMB 24,793,200 after
transference, and was not the joint-venture any more. 25% equity owned by Anhui Meiling Electric
Co., Ltd has been transferred totally to original Meiling Group in July 2009.
Registration No. of the Business License of Corporation Legal Person: 340100000004040;
organization code of No. 76082307-7; Address: Meiling Industry Zone, Development Zone,
Feidong Xinchang, Hefei City; Legal Representative: Wang Yong; Business Scope: Research,
manufacture and sales of Roller washing machine, wave automatically washing machine, wave double-tube
washing machine and other appliance; Manufactures and sales of the controller and matching line of
refrigerator, washing machine, air-conditioner and other household appliance
(47) Hefei Yingkaite Apparatus Co., Ltd.( Yingkaite Apparatus for short) was jointly set up by original
Meiling Group and Yingkaite Appliance on September 26, 2007. Its register capital was RMB 12 million,
among which, original Meiling Group invested RMB 8,670,600 in monetary capital, accounting
72.255% in registered capital; Yingkaite Appliance invested RMB 3,329,400 in the assessment
value of intangible assets (land-use right), accounting 27.745% of total registered capital. The
134
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(Unlessotherwisespecified.RMBforrecordinthestatement)
investment being verified by [WYAZ(2004) No. 135] from Anhui Yongan CPAs Co., Ltd.
Registration No. of the Business License of Corporation Legal Person: 340122000001532;
organization code of No. 66624534-6; Address: (No.15 Jinyang Road) Meiling Industrial Zone,
Development Zone, Feidong Xinchang, Hefei City; Legal Representative: Liu Shiqun; Business
Scope: Manufacture and operation on cooling appliance, washing machine and plastic products; operational
of the self-produced products on raw&auxilary materials as well as import&export business( projects limited
by the national excluded)
(48) Meiling Non-ferrous Metal Products Co., Ltd. (Non-ferrous Metal for short) was the sino-foreign joint
venture jointly set up by original Meiling Group, Hefei Meiling Copper Co., Ltd. And Singapore Kim Shin
Development Co., Ltd., which have been originally approved by the [WJMWFZZ(1996) No.349] of
Foreign Trade and Economic Committee of Anhui Province. Its registered capital was US$ 2.92
million upon establishment, of which, original Meiling Group invested US$ 1.46 million (monetary
capital), accounting 50% of the registered capital, Hefei Meiling Copper Co., Ltd invested US$ 0.584
million (monetary capital of RMB 0.18 million and real assets of US$ 0.404 million), accounting 20% of
registered capital while Singapore Kim Shin Development Co., Ltd invested US$ 0.876 million
(monetary capital), accounting 30% of the registered capital. The above mentioned investment
verified by the verification report of [HSWZ(1995) No. 0737], [HSWZ(1996) No. 328] and
[HSWZ(1998) No. 088] from Anhui CPAs Co., Ltd. In July 2008, approved by [HWS(2008) No.53]
from Foreign Trade Economic Cooperation Bureau of Hefei City, 30% equity and 20% equity held
by Singapore Kim Shin Development Co., Ltd and Hefei Meiling Copper Co., Ltd respectively transferred
to original Meiling Group Totally. The Company’s register capital came into RMB 24,286,808.00
after transference, and was not the joint-venture any more.
Registration No. of the Business License of Corporation Legal Person: 340100000111925;
organization code of No.14911702-0; Address: Meiling Industrial Zone, Changjiang East
Road,Hefei City; Legal Representative: Huang Danian; Business Scope: Manufacture and sales
various copper tube, line materials and other metal products
(49) Hefei Meiling Precision Tube Co., Ltd. (Precision Tube for short) was set up in March 2004 with RMB
1 million register capitals. Among which, the original Meiling Group invested RMB0.8 million in
monetary capital accounting 80% of register capital while Anhui Meiling Electric Co., Ltd. Invested
RMB 0.2 million in monetary capital accounting 20% of register capital. The investment being
verified by [WYAYZ(2004) No. 041] from Anhui Yongan CPAs Co., Ltd. 20% equity owned by
Meiling Electric have been transferred totally to original Meiling Group on August 20, 2009.
Registration No. of the Business License of Corporation Legal Person: 340122000010759;
organization code of No.75854571-7; Address: Meiling Industry Zone, Development Zone, Feidong
Xinchang, Hefei City; Legal Representative: Zhao Yong; Business Scope: Manufacture and sales of
fine welded pipe and cooling fittings.
(50) Hefei Meiling Package Products Co., ltd(Package Products for short) was the sino-foreign joint venture
jointly set up by Hefei Paper Box Plant, original Meiling Group and Singapore Anda Development Co., Ltd
in December 1993, which approved by [HWJZ(1993) No. 0444] of Foreign Trade and Economic
Committee of Hefei City with its register capital of US$ 3.067 million. The register capital while
established have been verified by [HKHY(1995) No. 5] from original Hefei CPAs Co., Ltd. On
December 30, 2002, being approved by [HWJ(2002) No. 259] of foreign trade Economic
Cooperation Bureau of Hefei City, 48.28% equity owned by Hefei Paper Box Plant transferred to
the Company. On June 17, 2005, 25% equity owned by Singapore Anda Development Co., Ltd
135
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
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(Unlessotherwisespecified.RMBforrecordinthestatement)
transferred to original Meiling Group freely by one-time. The Company turned into domestic-capital
enterprise from foreign-capital enterprise with changed registered capital of RMB 18.4 million. The
re-register of register capital being verified by [WCQYZ(2005) No. 256] from Anhui CHengqin
CPAs Co., Ltd. After equity transferred, the Company invested RMB 8.88 million accounting
48.28% in register capital while Meiling Group invested RMB9.52 million with 51.72% in register
capital.
Registration No. of the Business License of Corporation Legal Person: 3401001007135;
organization code of No.61030893-4; Address: Meiling Industry Zone,Dong twenty bu, Hefei City;
Legal Representative: Huang Danian; Business Scope: Manufacture and sales of corrugated board,
paper boxes, paper element, EPS, foam package materials and aluminium foil sealing tape.
(51) Hefei Meiling Environment-friendly Package Materials Co., Ltd. (Environment-friendly Package for
short) was set up on May 11, 2005 with register capital of RMB 0.8 million. The original Meiling Group
invested RMB 0.64 million, accounting 80% of register capital. RMB 0.16 million was invested by
Hefei Meiling Economy Development Co., Ltd as monetary capital, accounting 20% of register
capital. Hefei Meiling Economy Development Co., Ltd. transferred its 20% equity to original
Meiling Group on July 20, 2009.
Registration No. of the Business License of Corporation Legal Person: 340122000010381;
organization code of No. 77495478-0; Address: Meiling Industry Zone,Dong twenty bu, Hefei
City; Legal Representative: Sun Qingfeng; Manufacture and sales of belt, EPS, foam products, PP
hollow profile, moulded pulp, honeycomb paperboard and materials of granulation package.
(52) Hefei Meiling Appliance Industy&Commerce Co., Ltd. (Appliance Industy&Commerce for short) was
set up on June 17, 2003 with register capital of RMB 2 million. Among which, original Meiling Group
invested RMB 1.2 million in monetary capital, accounting 60% of register capital; Hefei Meiling Grant
Hotel invested 0.6 million in monetary capital, accounting 30% of register capital and Hefei Meiling
Washing Machine Co., Ltd. Invested RMB 0.2 million in monetary capital, accounting 10% of register
capital. The investment being verified by [WDHYZ(2003) No. 1117] of Anhui Ludong CPAs Co., Ltd. On
April 8, 2005, the original shareholder increased RMB 3 million (including RMB 857,823 monetary
capital and RMB 2,142,177 unditribution profit) in the company. The investment proportion
remains the same as usual. The capital increasement verified by [WDHYZ(2005) No. 1095] of
Anhui Ludong CPAs Co., Ltd. On September 23, 2008, 30% equity and 10% equity owned by Hefei
Meiling Grant Hotel and Hefei Meiling Washing Machine Co., Ltd respectively transferred to original
Meiling Group in total.
Registration No. of the Business License of Corporation Legal Person: 340122000001039;
organization code of No.75097049-5; Address: Feidong Xincheng Development Zone, Hefei City;
Legal Representative: Jiang Chanzhi; Business scope: Manufacture and sales of household apparatus
(products need for specific approved, should not be operation until approved)
(53) Hefei Maston Appliance Co., Ltd (Maston for short) was set up in November 2004 with register
capital of RMB 3 million. Among which, original Meiling Group invested RMB 0.7 million with
23.33% equity held. Liu Shikun (individual person) invested 0.94 million with 31.33% equity held
while Li Xunzhu (individual person) invested RMB 1.36 million with 45.34% equity held. The
investment being verified by [WDHYZ(2005) No. 1063] of Anhui Ludong CPAs Co., Ltd. The increased
register capital of RMB 0.98 million on December 31, 2006. Among which, original Meiling Group
increased RMB 0.25 million, Liu Shikun increased RMB 0.22 million while Li Xunzhu increased
136
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
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(Unlessotherwisespecified.RMBforrecordinthestatement)
RMB0.51 million. The register capital after increasing will be RMB 3.98 million. On July 29, 2009,
29.15% and 46.98% equity owned by Liu Shikun and Li Xunzhu respectively transferred to original
Meiling Group.
Registration No. of the Business License of Corporation Legal Person: 340106000034030;
organization code of No.76900598-6; Address: No.669, Changjiang West Road, Hefei City; Legal
Representative: Jiang Chanzhi; Business scope: R&D, manufacture and sale of refrigerator and small
appliance and other appliance.
(54) Chaohu Meiling Appliance Marketing Co., Ltd. (Chaohu Meiling) was established on 1
December 2009 with register capital of RMB 5 million. Chaohu Hualong Appliance Co., Ltd.
invested RMB 2 million, a 40% of the total register capital; Meiling Marketing Company invested
RMB 1 million, 20% of the total register capital while RMB 2 million totally collected by Jincheng
Appliance Co., Ltd. and other 7 shareholders in Wuwei County Anhui Province. In 2011, Chaohu
Hualong Appliance Co., Ltd entered into contract with Meiling Marketing Company and other 7
natural person shareholders for 40% equity held transferring and Meiling Marketing transferred
32% of equity held. After equity transferring, Meiling Marketing invested RMB 2.5 million of 50%
equity of Chaohu Meiling held and become the first largest shareholders; Jincheng Appliance Co.,
Ltd in Wuwei Country, Anhui Province invested RMB 1 million of 20% equity held; Chaohu Renhe
Commercial & Trade Company invested RMB 0.75 million of 15% equity held; other 10 natural
person shareholders invested RMB 0.75 million in total of 15% equity held. The equity transferring
finished changes in industrial & commercial dated 12 May 2011.
Registration No. of the Business License of Corporation Legal Person: 341402000029955(1-1);
organization code of No. 69739029-8; Address: No. 107, 56# building, Lijing International
Community, Jiankang West Rd., Chaohu City; Legal Representative: Cui Lianbin; Business scope:
sales and maintenance of household apparatus and recycle of aged apparatus.
(II) Special purpose entities or the operating entities with controlling rights formed through
entrusted operations or leases: Nil
(III) Changes in the consolidation scope of the consolidated financial statements of the year
1. The companies newly consolidated during the year: Nil
2. The companies deconsolidated in the year: Nil
(IV) Business combination during the year
1. The subsidiaries obtained through business combination under the same control: Nil
2. The subsidiaries obtained through business combination under the different control: Nil
(V) Convertion in foreigne currency statement
Sub-subsidiary -- Changhong Ruba located in Lahore, Pakistan. Book keeping with local currency
Rupee, balance sheet at year-end was converted as:
Excha Excha
Items Amount for Amount for Amount for Amount for
nge Items nge
FC RMB FC RMB
rate rate
341,310,820.3
Current assets 0.0671 22,906,766.47 Current liability 131,144,807.86 0.0671 8,801,664.96
3
Non-current
6,557,195.00 0.0671 440,080.20 Total liability 131,144,807.86 0.0671 8,801,664.96
assets
347,868,015.3
Total assets 23,346,846.67 Paid-in capital 259,900,258.39 0.0734 19,070,433.88
3
Retained profit -43,177,050.92 -2,993,267.40
137
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Total owners’
216,723,207.47 16,077,166.48
equity
Liability and total
347,868,015.33 24,878,831.44
equity
Difference between foreign currency -1,531,984.7
conversion 7
VIII. Notes to the major items in the consolidated financial statements
With respect to the financial statements figures disclosed below, unless otherwise specified,
“year-beginning” refers to 1 January 2012; “period-end” refers to 30 June 2012; “this period” refers
to 1 January to 30 June 2012; “same period of last yera” refers to 1 January to 30 June 2011; the
currency is RMB.
1.Monetary fund
Amount at period-end Amount at year-beginning
Item Original Exchange Original Exchange
RMB converted RMB converted
currency rate currency rate
Cash holdings 1,073,493.68 447,954.34
RMB 1,063,442.23 1,063,442.23 440,735.84 440,735.84
INR 149,798.00 0.0671 10,051.45 102,974.30 0.0701 7,218.50
Bank deposit 860,055,857.75 1,093,034,978.48
RMB 787,087,304.16 787,087,304.16 1,032,760,816.51 1,032,760,816.51
USD 10,601,893.19 6.3249 67,055,914.24 7,233,629.83 6.3009 45,578,378.20
EUR 157,622.03 7.8710 1,240,643.00 21,692.07 8.1625 177,061.52
AUD 154.15 6.3474 978.45 99.64 6.4093 638.62
INR 69,612,785.44 0.0671 4,671,017.90 207,105,329.96 0.0701 14,518,083.63
Other monetary
305,715,723.48 308,191,746.59
fund
RMB 280,953,100.33 280,953,100.33 297,822,767.67 297,822,767.67
USD 3,701,006.36 6.3249 23,408,495.13 1,403,177.99 6.3009 8,841,284.20
EUR 171,945.91 7.8710 1,353,386.26 187,129.00 8.1625 1,527,440.46
AUD 116.86 6.3474 741.76 39.67 6.4093 254.26
Total 1,166,845,074.91 1,401,674,679.41
Balance at period-end saving overseas amounting to RMB 4,681,069.35; other monetary fund mainly
refers to the margin of bank acceptance bill and savings of foreign exchange in account that need
for verified; except margins, no amount of pledge or froze that exits recovery potential risk for
reliability in monetary funds.
2. Notes receivable
(1) Category of notes receivable
Category Amount at period-end Amount at year-beginning
Bank acceptance notes 2,557,190,766.71 1,523,729,827.01
Commercial acceptance - -
Total 2,557,190,766.71 1,523,729,827.01
138
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Note receivable at period-end increase RMB 1033.4609 million over that of year-begin with
67.82% up, mainly because the acceptance bill increased in peak sesons for sales and the bills are
not due for receipt.
(2) Top five notes mortgaged by end of the period:
Note
Category Issuing company Issuing Maturity Amount
Serials
Bank
acceptan Fujian Suning Appliance Co., ltd. 2012-4-9 2012-10-9 10,000,000.00 21136596
ce
Bank
1030005220
acceptan Tianjin Gome Appliance Co., ltd 2012-5-30 2012-11-30 6,000,000.00
281789
ce
Bank
Changsha Tongcheng Holding
acceptan 2012-4-26 2012-10-26 4,000,000.00 21437535
Co., Ltd.
ce
Bank
Anhui Hualian Shangsha Co.,
acceptan 2012-3-15 2012-9-15 4,000,000.00 20201916
Ltd.
ce
Bank
Anqing Chaojie Appliance
acceptan 2012-2-28 2012-8-28 4,000,000.00 20489026
Co.,Ltd.
ce
(3) Top five notes endorsed to others but not yet due at the end of the period:
Note
Category Issuing company Issuing Maturity Amount
Serials
Bank
Nanjing purchasing centre of
acceptan 2012-5-25 2012-11-24 14,122,489.67 22180111
Suning appliance Co., ltd.
ce
Bank
Shenyang Suning Appliance Co.,
acceptan 2012-5-18 2012-11-18 10,000,000.00 20348977
ltd.
ce
Bank
Nanjing purchasing centre of
acceptan 2012-3-30 2012-9-30 8,938,121.90 22970240
Suning appliance Co., ltd.
ce
Bank
Shanghai Suning Appliance Co.,
acceptan 2012-5-14 2012-11-14 6,425,485.88 21115528
ltd.
ce
Bank
Beijing Jingdong Centry IT 3080005392
acceptan 2012-5-30 2012-11-23 5,000,000.00
Co.,Ltd. 217730
ce
(4) Note has been discount at period-end without expiration
139
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Categor Note
Issuing company Issuing Maturity Amount
y Serials
Bank
Nanjing purchasing centre of
acceptan 2012-5-4 2012-11-4 10,000,000.00 20017761
Suning appliance Co., ltd.
ce
Bank
Nanjing purchasing centre of
acceptan 2012-5-4 2012-11-4 4,705,485.01 20017827
Suning appliance Co., ltd.
ce
Bank
Nanjing purchasing centre of
acceptan 2012-3-2 2012-9-2 4,026,320.31 20936300
Suning appliance Co., ltd.
ce
Bank
acceptan TCL Corporation 2012-1-10 2012-7-10 2,000,000.00 20696339
ce
Bank
acceptan TCL CORPORATION 2012-1-10 2012-7-10 2,000,000.00 20696340
ce
3. Accounts receivable
(1) Age structure of account receivable
Amount at period-end Amount at year-beginning
Reserve for bad Reserve for bad
Book balance Book balance
debts debts
Item Perc Perc Perc Perc
enta enta enta entag
Amount Amount Amount Amount
ge ge ge e
(%) (%) (%) (%)
Within 1 1,019,006,930.1 43,450,209.0
96.81 85.24 583,809,925.83 96.60 25,746,545.48 77.69
year 1 3
1-2 years 22,910,814.37 2.18 599,738.38 1.18 9,856,885.03 1.63 1,061,655.26 3.20
2-3 years 5,619,144.11 0.53 1,934,896.03 3.80 5,698,992.08 0.94 1,791,750.48 5.41
3-4 years 1,354,793.67 0.13 1,242,268.10 2.44 1,824,158.65 0.30 1,771,932.06 5.35
4-5 years 747,825.81 0.07 746,212.11 1.46 3,117,428.41 0.52 2,717,483.92 8.20
Over 5
2,995,844.05 0.28 2,995,844.05 5.88 50,464.45 0.01 50,464.45 0.15
years
Total 1,052,635,352.12 100.00 50,969,167.70 100.00 604,357,854.45 100.00 33,139,831.65 100.00
Net
1,001,666,184.42 571,218,022.80
value
Account receivable at period-end increase RMB 430.4482 million over that of year-begin with
75.36% up, mainly because (1) in peak seasons, the credit limit gwoth in a controllable risk range in
order to promote sales; (2) suffered from the business of changes from marketing company, the
clients have more times for settlement in chain clients.
(2) Risk structure of account receivable
Item Amount at period-end Amount at year-beginning
140
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Reserve for bad Reserve for bad
Book balance Book balance
debts debts
Percen Percen Perce
Percent
Amount tage Amount Amount tage Amount ntage
age (%)
(%) (%) (%)
Significant account
receivable and
- - - - - - - -
withdrawal bad debt
provision single
Account receivable withdrawal bad debt provision by combination
Combination 1 872,638,247.31 82.90 48,413,679.72 5.55 518,142,685.13 85.73 30,345,853.45 5.86
Combination 2 177,441,616.83 16.86 - - 82,351,548.50 13.63 - -
Subtotal of
1,050,079,864.14 99.76 48,413,679.72 4.61 600,494,233.63 99.36 30,345,853.45 5.05
combination
Account receivable
with single minor
amount but 2,555,487.98 0.24 2,555,487.98 100.00 3,863,620.82 0.64 2,793,978.20 72.32
withdrawal bad debt
provision singly
Total 1,052,635,352.12 100.00 50,969,167.70 4.84 604,357,854.45 100.00 33,139,831.65 5.47
Net value 1,001,666,184.42 571,218,022.80
(3) Account receivable with single major amount but withdrawal bad debt provision singly: Nil
(4) In combinations 1, withdrawal bad debt provision by account age analysts:
Amount at period-end Amount at year-beginning
Perc Perc
Age enta Reserve for bad enta Reserve for bad
Amount Amount
ge debts ge debts
(%) (%)
With 1year 860,120,762.87 5 43,006,038.14 503,159,028.95 5 25,157,951.45
1-2years 3,998,255.86 15 599,738.38 7,077,701.75 15 1,061,655.26
2-3 years 5,528,274.36 35 1,934,896.03 5,119,287.10 35 1,791,750.49
3-4 years 258,518.55 55 142,185.20 116,059.08 55 63,832.49
4-5 years 10,758.00 85 9,144.30 2,666,296.57 85 2,266,352.08
Over 5
2,721,677.67 100 2,721,677.67 4,311.68 100 4,311.68
years
Total 872,638,247.31 48,413,679.72 518,142,685.13 30,345,853.45
Net value 824,224,567.59 487,796,831.68
(5) Vary account in combination 2:
Provision Reserve for bad
Combination Book balance
proportion (%) debts
Account connect with related parties 107,547,632.31 0% -
Account receivable with L/C 66,936,316.15 0% -
Account receivable insured 2,957,668.37 0%
Total 177,441,616.83 -
(6) Account receivable with single minor amount but withdrawal bad debt provision singly at
141
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
period-end
Provision
Bad debt
Company Book balance proportion Accrual reasons
amount
(%)
Department Store of Wendeng City
129,051.14 129,051.14 100%
Shandong Province
Jiangsu Zhenjiang Gome Electrical
176,425.61 176,425.61 100%
Appliance Co., Ltd.
Liuzhou Minyu Hardware Business
51,588.00 51,588.00 100%
Department Cease business
Nanjing Central Emporium Co., Ltd, 512,925.85 512,925.85 100% contact for 2 to 3
Zhejiang Yongle Appliance Co., years; predicted
95,090.82 95,090.82 100%
Ltd.(Taizhou) un-receivable for
Gaomi Sanhe Appliance Sales Co., failue urging
610,458.57 610,458.57 100%
Ltd.
Cifeng Baixin Apparatus Co., Ltd. 271,114.97 271,114.97 100%
Yichun Jixing Household Appliance
218,509.36 218,509.36 100%
Mall
MEKONG ELECTRONICS(LAOS)C 122,987.52 122,987.52 100% Balacne of bad
bedt after
FOXMAN FUEGUINA S.A. 321,183.37 321,183.37 100% compensation from
insurance company
Hefei Greatwal Refrigeration
24,449.77 24,449.77 100%
Technology Co., Ltd.
Hongtaiyang Apparatus Mall of
1,470.00 1,470.00 100%
Longsha District, Qiqihaer predicted
Jinhua Suning Appliance Co., Ltd. 7,122.00 7,122.00 100% un-receivable for
Jiangxi HongtaiAppliance Industry long account age
2,698.00 2,698.00 100%
Trading Co., Ltd.
Tongliao Wanton Apparatus
10,413.00 10,413.00 100%
Commerce Trading Co., Ltd.
Total 2,555,487.98 2,555,487.98
(7) Account receivable received previous which have been verified: Nil
(8) switch-back of bad debt provision: Nil
(9) Account receivable verified in this year: Nil
(10) Arrears of the shareholders holding more than 5% (including 5%) shares with voting rights of
the Company
Amount at period-end Amount at year-beginning
Company Bad debt Bad debt
Arrears Arrears
provision provision
Sichuan Changhong Electric
13,031,589.47 - 25,257.14 -
Co., Ltd.
(11) Particular about Top five accounts receivable
142
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Relationship Percentage in
Company with the Amount Age total accounts
Company receivable
Nanjing purchasing centre of Suning appliance Within one
Non-related party 204,137,897.35 19.39%
Co., ltd. year
Within one
Electrolux (China) Electric Co., Ltd. Non-related party 87,534,851.53 8.32%
year
Within one
Chengdu Gome Appliance Co., Ltd Non-related party 40,331,660.30 3.83%
year
Within one
PT.CHANGHONG ELECTRIC INDONESIA Same control 36,976,610.72 3.51%
year
Within one
Electrolux Major Appliances, Latin Ameri Non-related party 27,663,858.59 2.63%
year
Total 396,644,878.49 37.68%
(12) Details of account receivable from related parties found in (III) of Annotation 9
(13) Balance of accounts receivable in foreign currencies
Amount at period-end Amount at year-beginning
Foreign
currency Original Exchange Original Exchange
RMB converted RMB converted
currency rate currency rate
USD 39,440,763.30 6.3249 249,458,883.80 18,249,904.66 6.3009 114,990,824.27
EUR 371,379.60 7.8710 2,923,128.83 80,368.91 8.1625 656,011.23
AUD 2,923,752.76 6.3474 18,558,228.27 1,513,855.35 6.4093 9,702,753.09
INP 71,308,655.00 0.0671 4,784,810.75 - - -
Total 275,725,051.65 125,349,588.59
4.Accounts paid in advance
(1) Account paid in advance classify according to age structure
Amount at period-end Amount at year-beginning
Item Percentage Percentage
Amount Amount
(%) (%)
Within 1 year 156,149,323.02 95.40 230,371,287.90 97.00
1－2 years 1,597,774.57 0.98 3,328,517.45 1.40
2－3 years 2,272,778.68 1.39 72,619.25 0.03
Over 3 years 3,645,380.24 2.23 3,722,320.43 1.57
Total 163,665,256.51 100.00 237,494,745.03 100.00
Account paid in advance at period-end decrease RMB 73.8295 million over that of year-begin with
31.09% down, mainly due to the settlement of account paid in advance for goods.
(2) Account of top five companies paid in advance
Relationship with Reason for
Company Amount Age
the Company unsettlement
Yantai WanHua Polyurethanes Non-related parties Within 1 Goods not
27,680,642.30
Co., Ltd. supplier year received
Anhui Baogang Stell Distribution Non-related parties Within 1 Goods not
14,715,957.13
Co., Ltd. supplier year received
143
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Relationship with Reason for
Company Amount Age
the Company unsettlement
Huntsman Polyurethanes Non-related parties Within 1 Goods not
14,627,608.30
Shanghai Ltd. supplier year received
Non-related parties Within 1 Goods not
Angang Steel Company Limited 14,263,196.60
supplier year received
Shanghai Wugang East-China Non-related parties Within 1 Goods not
7,186,071.87
Sales Co., Ltd. supplier year received
Total 78,473,476.20
(3) The accounts paid in advance at the end of the year did not include any arrears of the
shareholders holding more than 5% (including 5%) shares with voting rights of the Company.
(4) Balance of the accounts paid in advance in foreign currencies
Amount at period-end Amount at year-beginning
Foreign
currency Original Exchange RMB Original Exchange RMB
currency rate converted currency rate converted
42,574,540.0
USD 6,731,259.00 6.3249 4,186,729.50 6.3009 26,380,163.91
5
EUR 604,617.28 8.0780 4,884,098.39 7,928,579.27 8.1625 64,717,028.29
47,458,638.4
Total 91,097,192.20
4
5.Other accounts receivable
(1) Age structure of other account receivable
Amount at period-end Amount at year-beginning
Book balance Reserve for bad debts Book balance Reserve for bad debts
Item
Percenta Percenta Percenta Percenta
Amount Amount Amount Amount
ge (%) ge (%) ge (%) ge (%)
Within 1
9,625,011.20 64.48 164,694.49 4.34 18,982,067.63 41.92 723,813.91 19.18
year
1-2years 460,936.94 3.09 58,399.07 1.54 21,538,529.29 47.57 106,978.24 2.84
2-3 years 1,206,815.32 8.09 413,598.70 10.90 1,712,496.92 3.78 535,778.01 14.21
3-4 years 891,408.25 5.97 480,800.34 12.67 498,394.62 1.10 8,565.83 0.23
4-5 years 436,175.18 2.92 371,042.93 9.78 140,629.43 0.31 88,754.43 2.35
Over
2,305,789.85 15.45 2,305,789.85 60.77 2,407,789.85 5.32 2,307,789.85 61.19
5years
Total 14,926,136.74 100.00 3,794,325.38 100.00 45,279,907.74 100.00 3,771,680.27 100.00
Net value 11,131,811.36
Other account receivable at period-end decrease RMB 30.3764 million over that of year-begin with
73.18% down, mainly because (1) the margin for appliance going down to countryside are return; (2)
export tax refund was received by Zhongshan Changhong.
(2) Risk structure of other account receivable
Item Amount at period-end Amount at year-beginning
144
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Reserve for bad Reserve for bad
Book balance Book balance
debts debts
Perce Perce
Percent Percent
Amount Amount ntage Amount Amount ntage
age (%) age (%)
(%) (%)
Significant account receivable
and withdrawal bad debt - - - - - - - -
provision single
Account receivable withdrawal bad debt provision by combination
Combination 1 6,202,889.78 41.56 1,529,897.51 24.66 16,690,144.72 36.86 1,498,067.40 8.98
Combination2 6,458,819.09 43.27 - - 26,316,150.15 58.12 - -
Subtotal of Combination 12,661,708.87 84.83 1,529,897.51 12.08 43,006,294.87 94.98 1,498,067.40 1.01
Account receivable with
single minor amount but
2,264,427.87 15.17 2,264,427.87 100.00 2,273,612.87 5.02 2,273,612.87 100.00
withdrawal bad debt
provision singly
Total 14,926,136.74 100.00 3,794,325.38 25.42 45,279,907.74 100.00 3,771,680.27 2.51
Net value 11,131,811.36 41,508,227.47
(3) Significant other account receivable and withdrawal bad debt provision single: Nil
(4) Among combinations 1, withdrawal of bad debt provision by age analysts:
Amount at period-end Amount at year-beginning
Age Percentag Reserve for Percentag Reserve for
Amount Amount
e (%) bad debts e (%) bad debts
within1year 3,293,889.70 5 164,694.49 14,296,807.93 5 714,840.39
1-2years 389,327.16 15 58,399.07 713,188.32 15 106,978.25
2-3 years 1,181,710.56 35 413,598.70 1,530,794.31 35 535,778.01
3-4 years 874,182.45 55 480,800.34 15,574.25 55 8,565.84
4-5 years 342,500.00 85 291,125.00 12,500.00 85 10,625.00
over5 years 121,279.91 100 121,279.91 121,279.91 100 121,279.91
Total 6,202,889.78 1,529,897.51 16,690,144.72 1,498,067.40
Net value 4,672,992.27
(5) Vary account in combination 2 as:
Reserve
Withdrawal
Combination Book balance for bad Age
proportion
debts
Employee’s reserve loans 1,045,172.34 0% - within 1 year
Export tax rebate receivable 5,413,646.75 0% - within 1 year
Total 6,458,819.09 -
(6) Other account receivable with single minor amount but withdrawal bad debt provision singly at
period-end
145
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Withdraw
Details of other
Book Reserve for al
account Reasons
balance bad debts proportio
receivable
n
Loans for resigned person,
Resignation staff 2,221,937.52 2,221,937.52 100%
un-recover predictely
Sporadic clients 35,970.35 35,970.35 100% un-recover predictely
th th
6 Construction 6
6,520.00 6,520.00 100% un-recover predictely
Office
Total 2,264,427.87 2,264,427.87
(7) Other account receivable received in previous which have been verified: Nil
(8) Reversal of reserve for bad debts: Nil
(9) Other receivable actually verified in this period: Nil
(10) Other receivables at the end of the period did not include the arrears of the shareholders
holding more than 5% (including 5%) of shares with voting rights of the Company.
(11) Top five of other account receivable
Relationship Proportion in
Company with the Amount Age total other
Company receivables
Non-related within1
Export tax refund 5,413,646.75 36.27%
party year
Social Security bureau of Hefei
Non-related within1
City(salary guarantee for migrant 1,414,712.00 9.48%
party year
workers)
Beijing branch of ICBC Assets Turst
Non-related
Specific A/C (margin of household 600,000.00 3-4 years 4.02%
party
appliance going down to village)
CEIEC (margin of household appliance Non-related within1
492,000.00 3.30%
going down to village) party year
Jidezhen Labor security monitoring Non-related within1
220,000.00 1.47%
(salary guarantee for migrant workers) party year
Total 8,140,358.75 54.54%
(12) Other account receivable from related parties: Nil
6. Inventories
(1)Classification of inventories
Amount at period-end Amount at year-beginning
Item Impairment Impairment
Book balance Book value Book balance Book value
provision provision
Raw materials 107,697,564.59 3,837,335.47 103,860,229.12 181,973,892.90 5,000,012.15 176,973,880.75
Stockcommodities 1,214,222,148.41 83,007,880.74 1,131,214,267.67 1,474,367,876.33 70,460,760.80 1,403,907,115.53
146
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Low value
consumable 5,846,770.75 - 5,846,770.75 7,299,359.37 - 7,299,359.37
articles
Goods in transit 163,531,417.13 4,822,201.72 158,709,215.41 205,668,015.22 4,748,185.87 200,919,829.35
Goods-in-process 44,693,006.48 1,115,911.20 43,577,095.28 27,152,435.20 1,126,667.36 26,025,767.84
Deferred expense
27,248,154.74 - 27,248,154.74 45,479,334.12 - 45,479,334.12
for moulds
Entrust process
714,889.55 714,889.55 - 714,889.55 714,889.55 -
materials
Total 1,563,953,951.65 93,498,218.68 1,470,455,732.97 1,942,655,802.69 82,050,515.73 1,860,605,286.96
(2) Provision for impairment of inventories
Amount at Increase during Decrease during the period Amount at the
Item
year-beginning the period reversal Switch-back period-end
Raw materials 5,000,012.15 - - 1,162,676.68 3,837,335.47
Goods in process 1,126,667.36 - - 10,756.16 1,115,911.20
Stock
70,460,760.80 19,189,628.54 - 6,642,508.60 83,007,880.74
commodities
Goods in transit 4,748,185.87 74,015.85 - - 4,822,201.72
Entrustprocessmaterials 714,889.55 - - - 714,889.55
Total 82,050,515.73 19,263,644.39 - 7,815,941.44 93,498,218.68
(3) Provision for impairment of inventories provided
Proportion of the reversal
Reason for reversal during amount during the year in
Item Provision basis
the year the period-end balance of
the inventory
Raw materials Compare the book cost and - -
realizable net value of the inventory
Goods in process by category; provide or reverse - -
provision for impairment of
Stock
inventory at the balance of realizable - -
commodities net value lower than the book cost
7. Long-term equity investment
(1) Classification of long-term equity investment
Amount at
Item Amount at period-end
year-beginning
Long-term equity investment accounted in the cost method 10,420,000.00 10,420,000.00
Long-term equity investment accounted in the equity method 25,677,665.23 26,490,458.62
Total long-term equity investment 36,097,665.23 36,910,458.62
Less: Provision for impairment of long-term equity investment - -
Value of long-term equity investment 36,097,665.23 36,910,458.62
147
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
(2)Long‐termequityinvestmentaccountedinthecostmethodandtheequitymethod
Holdi Voting Amount Cash
Increase Decrease
ng right Initial at Amount at dividend
Invested company propo propor during the during the
rtion tion amount year-begi year-end for the
year year
(%) (%) nning year
Accounting in the
cost method
1,073,757.3
1. Huishang Bank Co., Ltd. 0.13 0.13 5,000,000.00 5,000,000.00 - - 5,000,000.00
0
2. Jiujiang Meiling Electric
19 19 1,000,000.00 1,00,000.00 - - 1,000,000.00 -
Marketing Co., Ltd.
3. Bozhou Meiling Electric
18 18 800,000.00 720,000.00 - - 720,000.00 -
Marketing Co., Ltd.
4. Guangyuan Meiling
20 20 800,000.00 800,000.00 - - 800,000.00 -
Electric Marketing Co., Ltd.
5. Guangxi Meiling
Household Apparatus Co., 20 20 1,000,000.00 1,000,000.00 - - 1,000,000.00 -
Ltd.
6. Changzhou Meiling
20 20 600,000.00 600,000.00 - - 600,000.00 -
Electric Marketing Co., Ltd.
7. Xuancheng Meiling
16 16 800,000.00 800,000.00 - - 800,000.00 -
Electric Marketing Co., Ltd.
8.Buyang Meiling Electric
10 10 500,000.00 500,000.00 - - 500,000.00 -
Marketing Co., Ltd.
Subtotal - - 10,500,000.00 10,420,000.00 - - 10,420,000.00 1,073,757.30
Accounting in the
equity method
1. Hefei Meiling Packing
32.75 32.75 3,111,400.00 4,362,226.14 - 768,399.40 3,593,826.74 -
Products Co., Ltd.
2. Changhong Ruba
10,053,935.8
Electric Company(Private) 40 40 $1,600,000.00 - 220,191.66 9,833,744.17 -
3
Ltd.
3. Hefei Xingmei
12,074,296.6 12,250,094.3
Assets Management 48.28 48.28 12,094,369.48 175,797.67 - -
5 2
Co., Ltd.
Subtotal 25,325,585.48 26,490,458.62 175,797.67 988,591.06 25,677,665.23 -
Total 35,825,585.48 36,910,458.62 175,797.67 988,591.06 36,097,665.23 1,073,757.30
(3) Investment in associated companies
Holdin
Voting
g Total Total operating
right Total assets at Total net assets Net profit of
Invested company propor liabilities at income of the
proporti period-end at period-end the period
tion period-end period
on (%)
(%)
148
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Holdin
Voting
g Total Total operating
right Total assets at Total net assets Net profit of
Invested company propor liabilities at income of the
proporti period-end at period-end the period
tion period-end period
on (%)
(%)
Hefei Meiling Solar Energy
32.75 32.75 51,638,721.83 38,324,600.02 13,314,121.81 13,766,551.59
Technology Co., Ltd. -2,346,186.08
Changhong Ruba Electric
40.00 40.00 29,686,164.25 7,187,531.48 22,498,632.77 4,663,247.68
Company(Private) Ltd. -550,479.11
Hefei Xingmei Assets
48.28 48.28 29,462,169.71 1,923,899.60 27,538,270.11 1,513,552.20
Management Co., Ltd. 364,121.10
8. Investment properties
(1) Investment properties measured at costs
Decrease
Amount at Increase during Amount at
Item during the
year-beginning the period period-end
period
Original value 24,058,864.21 - - 24,058,864.21
Houses and buildings 23,142,172.83 - - 23,142,172.83
Land use rights 916,691.38 - 916,691.38
Accumulated depreciation
and accumulated 6,740,322.25 404,291.08 - 7,144,613.33
amortization
Houses and buildings 6,477,367.00 385,106.80 - 6,862,473.80
Land use rights 262,955.25 19,184.28 - 282,139.53
Provision for impairment - - - -
Houses and buildings - - - -
Land use rights - - - -
Book value 17,318,541.96 16,914,250.88
Houses and buildings 16,664,805.83 16,279,699.03
Land use rights 653,736.13 634,551.85
(2) Particular about mortgage of investment property
Item Land certificate serials Area (M2) Net book value Mortgage bank
Nantou Village, Nantou Yue Real Estate Zhengzi No. Foshan Branch of China
5,153.32 2,815,184.71
Town, Zhongshan City C1628036 Merchants Bank
Nantou Village, Nantou Zhong Fuguoyong No. (2003) Foshan Branch of China
845.00 634,551.85
Town, Zhongshan City 020642 Merchants Bank
Total 5,998.32 3,449,736.56
9.Fixed assets
(1) Classification of fixed assets by item
Amount at Decrease during Amount at
Item Increase during the period
year-beginning the period period-end
Original value 1,583,077,054.01 32,163,112.19 19,290,904.10 1,595,949,262.10
149
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Decrease during Amount at
Item Increase during the period
year-beginning the period period-end
Houses and
559,683,384.37 1,814,020.56 1,555,500.00 559,941,904.93
buildings
Mechanical
913,174,952.98 26,976,513.10 16,680,907.93 923,470,558.15
equipment
Transport
28,604,679.50 717,734.38 479,225.35 28,843,188.53
equipment
Others 81,614,037.16 2,654,844.15 575,270.82 83,693,610.49
Accumulated
629,493,311.65 Newlyadded Withdrawalthisyear 8,921,013.53 672,452,470.52
depreciation
Houses and
80,527,157.48 - 9,556,586.02 553,510.48 89,530,233.02
buildings
Mechanical
500,245,638.59 - 32,620,314.86 7,746,415.73 525,119,537.72
equipment
Transport
16,926,907.93 - 1,888,079.99 384,025.04 18,430,962.88
equipment
Others 31,793,607.65 - 7,815,191.53 237,062.28 39,371,736.90
Provision for
17,673,137.91 - 13,775.61 17,659,362.30
impairment
Houses and
1,240,639.77 - - 1,240,639.77
buildings
Mechanical
12,703,854.07 - 503.46 12,703,350.61
equipment
Transport
593,280.41 - - 593,280.41
equipment
Others 3,135,363.66 - 13,272.15 3,122,091.51
Book value 935,910,604.45 905,837,429.28
Houses and
477,915,587.12 469,171,032.14
buildings
Mechanical
400,225,460.32 385,647,669.82
equipment
Transport
11,084,491.16 9,818,945.24
equipment
Others 46,685,065.85 41,199,782.08
(2) Fixed assts temporary idle
Accumulated Depreciation
Item Original book value Net book value
depreciation provision
Houses and buildings 7,894,234.99 3,845,951.52 895,926.83 3,152,356.64
Mechanical equipment 160,080.00 121,885.09 - 38,194.91
Others 474,819.00 252,216.15 190,066.00 32,536.85
Total 8,529,133.99 4,220,052.76 1,085,992.83 3,223,088.40
150
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
(3) Fixed assets leased through operating lease:
Accumulated Depreciation
Item Original book value Net book value
depreciation provision
Mechanical
235,545.00 135,962.69 - 99,582.31
equipment
Others 1,071,895.60 540,616.90 - 531,278.70
Total 1,307,440.60 676,579.59 - 630,861.01
(4) Fixed assets used for mortgage
Name Property certificate serials Original value Net value Bank for mortgage
Financial Bureau of
Crashing plant FCQ(FD) No. 028284 242,232.00 -
Hefei City
Financial Bureau of
Distribution room FCQ(FD) No.028278 88,970.00 78,689.00
Hefei City
Financial Bureau of
Workshop FCQ(FD) No.028283 2,796,137.00 2,270,365.67
Hefei City
Financial Bureau of
Substation FCQ(FD) No.028273 12,055.47 6,767.81
Hefei City
Financial Bureau of
Compressor room FCQ(FD) No.028282 231,928.00 9,277.12
Hefei City
122767.20 Foshan Branch of China
Office building YFDZZ No.C1628036 860,810.06
Merchants Bank
Office Foshan Branch of China
YFDZZ No.C1628036 1,309,613.63 625,125.34
building(decoration) Merchants Bank
Office Foshan Branch of China
YFDZZ No.C1628036 3,332,464.76 1,590,704.46
building(decoration) Merchants Bank
2/F of #1plant Foshan Branch of China
YFDZZ No.C1628035 4,461,822.45 1,927,364.99
2/F of #2plant Merchants Bank
Foshan Branch of China
1/F of #1plant YFDZZ No.C1628035 2,230,911.23 963,682.50
Merchants Bank
Foshan Branch of China
1/F of #2plant YFDZZ No.C1628035 2,230,911.23 963,682.50
Merchants Bank
Foshan Branch of China
3# plant YFDZZ No.C1628037 10,510,553.63 4,833,618.10
Merchants Bank
Foshan Branch of China
2/F of #3plant YFDZZ No.C1628037 961,963.73 385,521.12
Merchants Bank
Foshan Branch of China
Warehouse YFDZZ No.C1628037 1,897,142.05 760,307.57
Merchants Bank
Foshan Branch of China
2/F of #4plant YFDZZ No.C1652820 1,212,957.95 486,110.72
Merchants Bank
Dormitory of 1#, 2#, YFDZZ No.C165275 4,910,007.80 1,958,483.05 Foshan Branch of China
151
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Name Property certificate serials Original value Net value Bank for mortgage
3# YFDZZ No.C165282 Merchants Bank
YFDZZ No.C1628038
Foshan Branch of China
4# dormitory building YFDZZ No.C1652754 1,519,062.18 605,917.02
Merchants Bank
Foshan Branch of China
Canteen YFDZZ No.C1652823 1,178,632.00 472,354.04
Merchants Bank
Total 39,988,175.17 17,937,971.01
(5) Fixed assts without property certificate—House and buildings
Assets Original value
circulating water pump house/ equipment house 1,308,241.16
Canteen 2,415,806.73
1# dormitory building 4,913,840.64
2# dormitory building 4,844,585.04
1# dormitory building for cadremen 7,274,044.55
2# dormitory building for cadremen 7,272,362.29
5# plant 8,353,661.36
Total 36,382,541.77
10.Construction in progress
(1) Details of construction in progress
Amount at period-end Amount at year-beginning
Book balance Impai Book value Book balance Imp Book value
rment air
provis men
Item
ion t
pro
visio
n
Manufacture base
project of the Athena 174,621,182.41 - 174,621,182.41 146,061,237.33 - 146,061,237.33
luxury refrigerator
construction of the
project of ice cube 11,000,736.56 - 11,000,736.56 9,098,979.01 - 9,098,979.01
capacity expansion
Phase II of Changhong
3,411,415.20 - 3,411,415.20 3,208,102.64 - 3,208,102.64
Meiling industry park
Capacity expansion
project of energy-saving
498,198.30 - 498,198.30 2,176,188.93 - 2,176,188.93
and environmental
refrigerator
152
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Capacity expansion of
energy-saving and
environmental refrigerator 60,582,884.74 - 60,582,884.74 14,524,382.32 - 14,524,382.32
with annual output of 2
millions sets
Construction project of
Phase II for matching
7,167,478.04 - 7,167,478.04 2,425,458.56 - 2,425,458.56
life district of Meiling
Hi-Tech Industrial Park
Equipments pending for
9,210,336.68 - 9,210,336.68 8,572,344.96 - 8,572,344.96
installation
Other minor projects
19,045,383.05 - 19,045,383.05 17,986,627.69 - 17,986,627.69
etc.
Total 285,537,614.98 - 285,537,614.98 204,053,321.44 - 204,053,321.44
Construction in progress at period-end increase RMB 81.4843 million over that of year-begin with
39.93% up, mainly due to the in-complete of fund-raised projects invested in report period.
(2) Changes in significant construction in progress
Decrease during the period
Amount at Increase during Transfer to Other Amount at
Name
year-beginning the period period-end
fixed assets decrease
Manufacture base project
of the Athena luxury 146,061,237.33 28,559,945.08 - - 174,621,182.41
refrigerator a)
project of ice cube
9,098,979.01 1,901,757.55 - - 11,000,736.56
capacity expansion b)
Capacity expansion
project of energy-saving
2,176,188.93 1,937,964.27 3,615,954.90 - 498,198.30
and environmental
refrigerator c)
(Continued)
including: Interest
Proportion of Accumulated
interest capitalizati
project Progr amount of Capital
Name Budget capitalized on rate of
investment in ess interest source
amount of the the year
budget (%) capitalization
year (%)
Manufacture base project Mainly
793millio
of the Athena luxury 51% 78% - - -
n yuan
refrigerator
project of ice cube 375millio Mainly
58% 90% - - -
capacity expansion n yuan
Capacity expansion
project of energy-saving 118millio
100% 98% - - - Mainly raised
and environmental n yuan
refrigerator
153
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
a) Manufacture base of Athena luxury refrigerator constructed in two phases with total investment
of RMB 793,303,800. Plans to invest raised fund RMB 730 million, and rest of the capital will
collect by the company. This project was divided into 2 phases. Predictably total investment will be
RMB 793.3038 million for this project. Raised fund RMB 730 million will invest and rest of the
capital will collect by the company. Complement of the 1st phase of this project will form
productivity of 1.2 million sets of refrigeration’s with 3 doors, multiple doors and side by side
combination with volume above 220 litres. And when the 2nd phase is completed, productivity of
800,000 sets of refrigeration’s with 3 doors, multiple doors and side by side combination with above
220 litres of volume. Till end of this period, the Phase I of capacity expansion projects for Athena
luxury refrigerator has reached its expected serviceable condition with annual capacity of 1.2
million refrigerators (double shifts) produced. Part of first stage of the Phase II have been put into
trial production, whose capacity can reach annul output of 0.4 million refrigerators (double shifts).
b) This project was divided into 2 phases. Predictably total investment will be RMB 375.1778
millionforthisproject.RaisedfundRMB300millionwillinvestandrestofthecapitalwillcollect
by the company. Phase I will complete and put into production in January 2011, a production
abilityof600,000setsoffreezerswillgenerateannually.FirststageofPhaseIIhasbeenputinto
production in March 2012 and capacity of annual 0.4 million refregirators (double shifts) will
increase; second stage of Phase II expecte to constructe in July 2012 and 0.2 million freezers
(doubleshifts)willincreaseaftercompletion.
c)Capacityexpansionprojectofenergy‐savingandenvironmentalrefrigeratorpredictedtoinvest
RMB 118.0093 million. Raised fund RMB 110 million will invested. RMB 50 million will invest in
registercapitalofMianyangMeiling,subsidiaryoftheCompanyforconstructionofproductionline
for energy‐saving and environmental refrigerator; RMB 60 million will invest in R&D of
energy‐savingandenvironmentalrefrigeratorandsalesandpurchaseofrawmaterials.Theproject
will put into production in December 2010 with capacity of 1.2 million sets (double shift) of
energy‐savingandenvironmentalrefrigeratorannually.
11. Intangible assets
(1) Items of intangible assets are set out as follows:
Amount at Increase during the Decrease during Amount at
Item
year-beginning period the period period-end
Original price
of intangible 966,933,957.33 2,245,377.66 - 969,179,334.99
assets
Land use right 638,981,493.04 22,349.70 - 639,003,842.74
Trademark
283,292,448.34 - - 283,292,448.34
special right
patent
2,066,100.00 - - 2,066,100.00
technology
Non-patent
42,593,915.95 2,223,027.96 44,816,943.91
technology
Accumulated
317,361,211.47 18,588,807.85 - 335,950,019.32
amortization
Land use right 63,653,725.68 6,974,836.09 - 70,628,561.77
Trademark
229,712,241.16 8,959,700.02 - 238,671,941.18
special right
patent
1,153,572.50 - - 1,153,572.50
technology
154
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Increase during the Decrease during Amount at
Item
year-beginning period the period period-end
Non-patent
22,841,672.13 2,654,271.74 - 25,495,943.87
technology
Provision for
912,527.50 - - 912,527.50
impairment
Land use right - - - -
Trademark
- - - -
special right
patent
912,527.50 - - 912,527.50
technology
Non-patent
- - - -
technology
Book value 648,660,218.36 632,316,788.17
Land use right 575,327,767.36 568,375,280.97
Trademark
53,580,207.18 44,620,507.16
special right
patent
- -
technology
Non-patent
19,752,243.82 19,321,000.04
technology
(2) As of the end of reporting period, mortgage of intangible assets is as follows:
Details of
Property certificate serials Area（M2） Net book value Note
intangible assets
ZFGY（2003）020639 14,834.30
Foshan
ZFGY（2003）020640 5,375.90 Ronggui
Office building,
ZFGY（2003）020641 16,198.20 Sub-branch
plant and 7,375,620.09
ZFGY（2003）020642 13,239.10 of China
dormitory land
ZFGY（2003）020643 15,381.40 Merchants
Bank
ZFGY（2003）020644 14,451.10
Total 79,480.00 7,375,620.09
12. Development expense
Decrease during the period
Amount at Increase
Record into Amount at
Item year-beginnin during the Confirm as
current gains period-end
g period intangible assets
and losses
Technology
development for 31,227,668.2
25,167,492.74 9,266,174.00 982,970.56 2,223,027.96
Changhong Air 2
Conditioner
13. Goodwill
155
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Increase Decrease
Amount at
during during Amount at Depreciation
Invested company year-beginnin
the the period-end reserves
g
period period
Hefei Meiling Group Holding
10,922,803.73 - - 10,922,803.73 5,392,961.64
Co., Ltd.
Goodwill generated from merger of Hefei Meiling Group classified according to assts group:
Impairment
Assets group Items Apportion Goodwill Net value
provision
Yingkeite
Appliance
Assets group A 846,742.35 846,742.35 -
Yingkeite
Apparatus
Precision tube
Assets group B Non-ferrous 2,706,625.42 2,706,625.42 -
metal
Package products
Assets group C Environment-frie 1,839,593.87 1,839,593.87 -
ndly
Package
Trademark
Assets group D 5,529,842.09 - 5,529,842.09
special right
Total 10,922,803.73 5,392,961.64 5,529,842.09
14. Deferred income tax assets
(1)Recognized deferred income tax assets
Amount at
Item Amount at period-end
year-beginning
Provision for impairment of assets 31,722,459.49 18,694,589.48
Projected liability 52,775,575.91 47,354,925.36
Dismiss welfare 7,423,272.66 7,235,790.89
Deficit 15,507,193.36 7,671,261.97
Expense withdrawal in advance 3,317,433.48 11,825,784.87
Total 110,745,934.90 92,782,352.57
(2)Unrecognized deferred income tax assets
Amount at Amount at
Item
period-end year-beginning
Deductible temporary difference 21,410,940.16 18,239,611.13
Deductible loss 114,363,471.96 96,850,913.46
Total 135,774,412.12 115,090,524.59
Due to that whether the future income obtained by Meiling Group, Mianyang Meiling, Jiangxi
Meiling Appliance and Guangzhou Meiling Marketing, the subsidiaries of the Company, could be
156
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
sufficient for being subject to taxation, such uncertainty led to no recognization for deferred income
tax assets.
(3) Items of deductible difference
Item Amount
Bad debt reserve for accounts receivable 50,160,045.23
Bad debt reserve for other receivables 3,326,549.15
Depreciation reserve for inventory 91,161,778.91
Impairment provision for fixed assets 9,092,569.00
Projected liability 351,837,172.76
Dismiss welfare 49,488,484.37
Deductible losses 62,154,438.96
Expenses withdrawal in advance 15,914,265.63
Subtotal 633,135,304.01
15. Impairment provision for assets
Amount at Increase Decrease during the period
Amount at
Item year-beginnin during the Other
Reversing period-end
g period transfer-out
Bad debt reserve 36,911,511.92 17,856,046.92 - 4,065.76 54,763,493.08
Inventory falling
82,050,515.73 19,263,644.39 - 7,815,941.44 93,498,218.68
price reserves
Depreciation reserve
17,673,137.91 - - 13,775.61 17,659,362.30
for fixed asset
Depreciation reserve
912,527.50 - - - 912,527.50
for intangible asset
Depreciation reserve
5,392,961.64 - - - 5,392,961.64
for goodwill
Total 142,940,654.70 37,119,691.31 - 7,833,782.81 172,226,563.20
16. Short-term loans
Amount at Amount at
Type of loans
period-end year-beginning
Loan in assurance - 24,000,000.00
Loan in credit 243,089,994.43 120,000,000.00
Total 243,089,994.43 144,000,000.00
Short-term loans at period-end increase RMB 99.09 million over that of year-begin with 68.81% up,
mainly due to the increase of credit loans from the Company and its subsidiary Zhongshan
Changhong gwroth in this period.
17. Notes payable
(1)Listed according to types of notes
Amount at Amount at
Type
period-end year-beginning
Bank acceptance bill 1,292,442,654.51 1,191,929,934.59
Commercial acceptance bill 447,070.00 -
157
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Amount at
Type
period-end year-beginning
Total 1,292,889,724.51 1,191,929,934.59
18. Account payable
(1) Account payable
Amount at Amount at
Item
period-end year-beginning
Total 2,005,315,350.75 1,598,851,420.62
Including: over 1 year 25,129,738.45 67,514,017.33
(2)Accounts payable to shareholders holding 5% or above voting shares of the Company
Amount at Amount at
Name of unit
period-end year-beginning
Sichuan Changhong Electric Co., Ltd. 47,883,784.51 58,615,813.70
(3)Account payable denominated in foreign currency
Amount at period-end Amount at year-beginning
Foreign Conversio Conversi
currenc Original n RMB Original on
y RMB equivalent
currency exchange equivalent currency exchange
rate rate
USD - - - 367,199.40 6.3009 2,313,686.70
EUR - - - - - -
JPY 16,151,872.84 0.079648 1,286,464.37 16,151,872.84 0.081103 1,309,965.34
Total 1,286,464.37 3,623,652.04
(4) Account payable for related parties found in (III) of Annotation 9.
19. Account received in advance(1) Account received in advance
Amount at Amount at
Item
period-end year-beginning
Total 434,002,521.83 703,404,091.67
Including: over 1 year 23,426,544.57 40,286,922.26
(2)Accounts received in advance from shareholders holding 5% or above voting shares of the
Company
Amount at Amount at
Name of unit
period-end year-beginning
Sichuan Changhong Electric Co., Ltd. - 89,047,249.11
Accounts received in advance at period-end decrease RMB 269.4016 million over that of
year-begin with 38.30% down, mainly due to the rapid up settlement for delivery notes in sales peak
season.
(3)Account received in advance denominated in foreign currency
158
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at period-end Amount at year-beginning
Foreign Conversi Conversio
currency Original on RMB Original n
RMB equivalent
currency exchange equivalent currency exchange
rate rate
AUD 595.50 6.3474 3,779.88 - - -
EUR 40,375.20 7.8710 317,793.20 2,528,586.11 8.1625 20,639,584.12
14,139,731.6
USD 6.3249 89,432,388.40 1,836,145.62 6.3009 11,569,369.94
0
INR 5,430,565.00 0.0671 364,390.91 - - -
Total 90,118,352.39 32,208,954.06
(4) Account receivable from related parties found in (III) of Annotation 9.
20. Wages payable
Amount at Increase in this Decrease in this Amount at
Item
year-beginning period period period-end
Salary, bonus, labor
53,008,557.05 249,006,554.58 282,416,189.70 19,598,921.93
expenses
Welfare for workers and
48,055.45 13,333,308.20 10,722,719.12 2,658,644.53
staff
Social insurance 2,631,944.93 38,490,045.60 37,172,900.68 3,949,089.85
Including: Medical
555,903.69 9,310,912.75 8,969,532.46 897,283.98
insurance
Basic endowment
1,603,803.28 25,047,240.50 24,168,208.07 2,482,835.71
insurance
.Unemployment
365,343.60 2,486,487.97 2,473,320.08 378,511.49
insurance
Work injury
58,195.37 1,053,213.47 986,345.10 125,063.74
insurance
Maternity
48,698.99 592,190.91 575,494.97 65,394.93
insurance
Housing accumulation
4,208,482.79 16,471,498.63 14,732,502.21 5,947,479.21
fund
Labour union
expenditure and
493,095.11 395,891.13 572,146.57 316,839.67
personnel education
expense
Non-monetary welfare - - - -
Dismiss welfare* 48,238,605.92 6,170,066.36 4,920,187.91 49,488,484.37
Others 934,064.00 113,080.00 61,700.00 985,444.00
159
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Including: shares
payment settled with - - - -
cash
Total 109,562,805.25 324,296,012.03 350,913,913.72 82,944,903.56
According to inner early retirement policy of the Company, salary, social insurance and retired
welfare during dated of retired and normal retirement date for employees signed agreement in this
year, totally RMB 6,170,066.36 was accrued. Since the Company has committed that it would make
corresponding improvement for treatment of the inner retired employees as the lowest life security
climbs. When calculating expense of wages and social insurances received by the inner retired
employees, the Company was subject to present standard, without consideration of discount.
The salary, bonus and allowance withdrawal in amount of year-end of wages payable has been
distributed in January and February of 2012.
21. Tax payable
Item Amount at period-end Amount at year-beginning
Value-added tax 81,993,672.59 3,688,300.36
Business tax 253,915.09 368,414.01
Enterprise income tax 29,686,930.89 45,895,657.02
Individual income tax 722,084.33 2,397,782.99
Urban maintenance and construction tax 7,617,186.02 7,627,781.47
House property tax 699,546.83 2,073,065.95
Land-use right tax 880,958.89 1,016,066.89
Educational surtax 5,653,891.65 5,507,762.29
Stamp tax 1,352,876.72 2,374,898.88
Construction fund of Water Conservancy Projects 662,810.49 1,472,978.36
Other 1517679.92 1,517,195.76
Total 131,041,553.42 73,939,903.98
Tax payable at period-end increase RMB 57.1016 million over that of year-ebgin with 77.23% up,
mainly because the VAT realized in June-sales peak season, gains a sharply gwroth.
22. Dividends payable
Amount at Reason for unsettlement
Name of unit Amount at period-end
year-beginning over one year
Ninbbo Weichuang Union Investment No extract required by
450,000.00 450,000.00
Co., Ltd, counterparty
International Business Department of
No extract required by
Industry and Commercial Bank of 153,697.50 153,697.50
counterparty
China of Anhui Branch
Bank of Communications, Hefei No extract required by
153,697.50 153,697.50
Branch counterparty
160
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Reason for unsettlement
Name of unit Amount at period-end
year-beginning over one year
No extract required by
Other piecemeal units 746,161.82 766,984.01
counterparty
Total 1,503,556.82 1,524,379.01
23. Other payable
(1) Other payable
Amount at Amount at
Item
period-end year-beginning
Total 799,045,107.44 518,444,925.03
Including: over 1 year 26,822,310.79 56,224,647.60
Amount with over one year age refers to margins payable to suppliers.
Other payable at period-end increase RMB 280.6002 million over that of year-ebgin with 54.12%
up, mainly because the expenses that occurred have not for reinbursment in this period.
(2)Other payable to shareholders holding 5% or above voting shares of the Company
Amount at Amount at
Name of unit
period-end year-beginning
Sichuan Changhong Electric Co., Ltd. 13,508,583.05 5,138,393.96
(3)Other account received denominated in foreign currency
Amount at period-end Amount at year-beginning
Foreign Conversio
Conversio
currency Original n RMB Original
n exchange RMB equivalent
currency exchange equivalent currency
rate
rate
USD 1,153,724.31 6.3249 7,297,190.89 866,042.87 6.3009 5,456,849.52
Total 7,297,190.89 5,456,849.52
24. Non-current liability due within one year
Amount at
Item Amount at period-end
year-beginning
Long-term loans due within one year 950,900.00 -
Bonds payable due within one year - -
Long-term accounts payable due within one year - -
Deferred income transfer to gains and losses within one year 2,454,607.92 2,452,094.16
Total 3,405,507.92 2,452,094.16
Non-current liability due within one year at period-end increase RMB 0.9534 million over that of
year-begin with 38.88% up, mainly because the long-term loans due within one year growth.
25. Long-term loans
(1)Classification of long-term loans
Amount at Amount at
Type
period-end year-beginning
Loan in pledge - -
161
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Amount at
Type
period-end year-beginning
Loan in mortgage 5,760,000.00 6,400,000.00
Loan in assurance - -
Loan in credit 5,354,600.00 6,305,500.00
Total 11,114,600.00 12,705,500.00
(2) Details of long-term loans at period –end
Amount at
Borrowin Returning Curre Interest Amount at
Loan unit year-beginnin
g day day ncy rate period-end
g
Ministry of Finance of
2006-11-09 2021-11-08 RMB 3.55% 5,760,000.00 6,400,000.00
HefeiNote1
Ministry of Finance of
2002-11-21 2017-11-20 RMB 3.80% 3,254,600.00 3,905,500.00
HefeiNote2
Ministry of Finance of
2004-12-10 2019-12-10 RMB 3.80% 2,100,000.00 2,400,000.00
HefeiNote3
Total 11,114,600.00 12,705,500.00
Note1: In August of 2006, the Company signed Asset Mortgage Agreement with Ministry of
Finance of Hefei. It takes five industry crusher chambers which cover an area of 2,322.98 square
meters (Details could be found in Fixed assets for mortgage in the Appendix VIII and X) as
mortgage for the Company to get the lending of treasury bond fund which has 15-year term and
worthy of RMB 7,040,000 from the Ministry of Finance of Hefei. The capital on-lending began to
bear interest from the appropriate date (November 9, 2006), which would be paid by stages in the
loan period to Ministry of Finance of Hefei by the Company. The first four years were grace period,
during which the annual interest rate was subject to floating interest rate (the annual interest rate
was the annual interest rate of one year fixed deposit plus 0.3%). The principal RMB640,000.00
and interest RMB 227,200.00 were paid in this year .
Note2: On November 1, 2002, the Company signed Agreement on Lending of Treasury Bond for
Building Project fund with Ministry of Finance of Hefei, which promised that Ministry of Finance
of Hefei lending treasury bond RMB 7,160,000 of the technology reform project of nanometer
preservation material to the Company with the return time limit of 15 years. The capital on-lending
began to calculate the interest from the appropriate date (November 21, 2002), which would be paid
by stages in the loan period to Ministry of Finance of Hefei by the Company. The first four years
were grace period, in which the annual interest rate was subject to floating interest rate after year
1999 (the annual interest rate was the annual interest rate of one year fixed deposit plus 0.3%). The
principal repaid in this year was RMB 650,900.00, and interest was RMB127,579.20. The principle
RMB650,900.00 payable has classified to non-current liability due within one year by the Company
dated 10 December 2012; interest RMB 148,400.00 will pay together with the principle and no
payment in this period.
Note3: It was the special treasury bond capital appropriated by Ministry of Finance of Hefei for
enterprises’ information reform, received on 10 December 2004. The principle RMB300,000.00
payable has classified to non-current liability due within one year by the Company dated 10
December 2012; interest RMB 91,200.00will pay together with the principle and no payment in this
period.
26. Special payable
162
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at Increase during Decrease during Amount at
Item
year-begin the period the period period-end
Relocation
compensation for 18,494,978.80 - 657,857.74 17,837,121.06
Jiangxi Meiling
Total 18,494,978.80 - 657,857.74 17,837,121.06
In January 2011, concerning the land located in Cidu Road, Jindetown City owned by Jiangxi
Meiling Company with aggregate are of 159,448.8 square meters, Land Reserve Centre of
Jindetown City recovering land use rights with land compensation of RMB 65 million (including
dismanting, relocation and setting) paid. The RMB 657,857.74 decreased in this period mainly refers to
the relocation expenses.
27. Projected liability
Amount at Increase during Carry-forward Amount at
Item
year-begin the period during the year period-end
Product quality guarantee 11,610,337.88 - - 11,610,337.88
Specific guarantee fund for
304,089,164.55 37,887,360.00 1,749,689.67 340,226,834.88
quality service of products
Total 315,699,502.43 37,887,360.00 1,749,689.67 351,837,172.76
Product quality guarantee was the ‘Three Guarantee” maintenance fee withdrawal according to the
‘Three Guarantee” policy; Specific guarantee fund for quality service of products was the accrual
overhaul expensed of the service activityen-year free maintenance for major parts of
country-oriented appliance.
28. Other non-current liabilities
Amount at Amount at
Item
period-end year-beginning
Deferred income 56,088,625.21 57,318,443.08
Mainly refers to the deferred income of dormitory building and supporting facility for employees,
which relocation from former Wuhu Road strategy move to Economic-Development Zone;
gradually recognize as income by depreciation of corresponding settlement assets for relocation
compensation received from the Governmetn.
29. Share capital
Amount at
Changeduringthe period Amount at period-end
year-begin
Pro Shares
Shareholders / type port New transferr Proport
Bonus Others
Amount shares edfrom Subtotal Amount
ion share ion%
issued capital
% reserve
Shares with
conditional 149,383,274 23.47 - - - -93,993,046 -93,993,046 55,390,228 8.70
subscription
State-owned shares 102,464 0.02 - - - -102,464 -102,464 - -
State-owned legal
80,953,606 12.72 - - - -33,490,596 -33,490,596 47,463,010 7.46
person shares
Other domestic shares 68,327,204 10.73 - - - -60,399,986 -60,399,986 7,927,218 1.24
Including: Domestic
68,224,740 10.72 - - - -60,503,474 -60,503,474 7,721,266 1.21
legal person shares
163
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at
Changeduringthe period Amount at period-end
year-begin
Pro Shares
Shareholders / type port New transferr Proport
Bonus Others
Amount shares edfrom Subtotal Amount
ion share ion%
issued capital
% reserve
Domestic
102,464 0.01 - - - 103,488 103,488 205,952 0.03
natural person shares
Foreign shares - - - - - - - - -
Including: Foreign
- - - - - - - - -
legal person shares
Foreign natural
- - - - - - - - -
person shares
Executives’ shares - - - - - - - - -
Shares with no restricted
487,066,064 76.53 - - - 93,993,046 93,993,046 581,059,110 91.30
condition
RMB common shares 351,346,064 55.20 - - - 93,993,046 93,993,046 445,339,110 69.97
Domestically listed
135,720,000 21.33 - - - - - 135,720,000 21.33
foreign shares
Overseas listed foreign
- - - - - - - - -
shares
Others - - - - - - - - -
Total shares 636,449,338 100.00 - - - - - 636,449,338 100.00
30. Capital reserve
Increase Decrease
Amount at Amount at
Item during the during the
year-begin period-end
period period
Share premium 1,561,918,988.45 - - 1,561,918,988.45
Capital reserve
transferred from original - - - -
system
Other capital reserve 48,080,558.82 - - 48,080,558.82
Total 1,609,999,547.27 - - 1,609,999,547.27
31. Surplus reserves
Decrease
Amount at Increase during Amount at
Item during the
year-begin the period period-end
period
Statutory surplus
184,018,222.78 - - 184,018,222.78
reserve
Discretionary surplus
115,607,702.16 - - 115,607,702.16
reserve
Total 299,625,924.94 - - 299,625,924.94
32. Retained profit
Withdraw or
Item Amount
distribution ratio
Amount at the end of last period 250,743,672.24
164
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Withdraw or
Item Amount
distribution ratio
Add: adjustment from undistributed profit at year-begin -
Including: change of accounting policy -
Correction of former material error -
Change of combination scope under common control -
Other adjustment factors -
Amount at the beginning of this year 250,743,672.24
Add: net profit attributable to shareholders of parent company for this
110,855,042.20
year
Deficit coverage of surplus reserve -
Less: withdraw of statutory surplus reserve -
withdraw of discretional surplus reserve -
Withdraw of general risk provision -
Dividend payable for ordinary shares -
Dividend of ordinary shares transferred to share capital -
Amount at the end of this period 361,598,714.44
Retained profit increase RMB 11,085.50 million over that of year-begin with 44.21% up, mainly due
to the new income obtained in this period.
33. Minority shareholder’s equity
Minority shareholding Amount at Amount at
Subsidiaries
ratio at period-end period-end year-beginning
Zhongke Meiling Cryogenics
30% 21,302,020.30 20,242,362.50
Limited Company
Hefei Meiling Appliance Marketing Found in Annotation
31,168,413.82 30,995,800.62
Co., Ltd. VII.”Sybsidiaries”
Zhongshan Changhong Appliance Found in Annotation
5,821,513.01 6,680,103.73
Co., Ltd. VII.”Sybsidiaries”
Total 58,291,947.13 57,918,266.85
34. Operating income and operating cost
(1) Operating income and operating cost
Amount at same
Amount at this
Item period of last
period
year
Main business income 5,137,875,700.69 5,168,549,152.44
Other business income 174,734,822.43 306,469,536.20
Total 5,312,610,523.12 5,475,018,688.64
Main business income 3,886,517,715.35 4,019,061,177.42
Other business income 157,459,482.91 282,394,871.08
Total 4,043,977,198.26 4,301,456,048.50
(2) Main business classified according to product
165
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at this period Amount at same period of last year
Product
Operating income Operating cost Operating income Operating cost
Refrigerator,
3,524,512,428.36 2,608,915,664.41 3,539,624,036.27 2,588,293,007.07
freezer
Air conditioner 1,480,247,536.02 1,159,935,393.63 1,522,538,794.50 1,341,976,407.24
Washing
68,173,774.95 54,339,892.93 56,711,859.87 49,255,837.49
machine
Other 64,941,961.36 63,326,764.38 49,674,461.80 39,535,925.62
Total 5,137,875,700.69 3,886,517,715.35 5,168,549,152.44 4,019,061,177.42
(3) Main business classified according to sales region
Amount at this period Amount at same period of last year
Region
Operating income Operating cost Operating income Operating cost
Domestic 4,522,151,494.79 3,289,722,049.67 4,524,774,628.61 3,390,966,852.43
Overseas 615,724,205.90 596,795,665.68 643,774,523.83 628,094,324.99
Total 5,137,875,700.69 3,886,517,715.35 5,168,549,152.44 4,019,061,177.42
(4) Sales income received from the top 5 customers this year
Proportion taking in total
Customer Operating income operating income of the
Company (%)
Sichuan Changhong Electric Co., Ltd. 772,244,674.67 14.54%
Nanjing purchasing centre of Suning appliance
529,893,810.47 9.97%
Co., ltd.
Chongqing Yu’ao Appliance Sales Co., Ltd. 56,934,952.64 1.07%
Anhui Baida Appliance Chain Co., ltd. 36,273,944.90 0.68%
Shijiazhuang Tianwang Refrigerator Co., Ltd. 33,897,865.70 0.64%
Total 1,429,245,248.38 26.90%
35. Business tax and extra charges
Amount at same period
Item Amount at this period
of last year
Business tax 14,137,344.39 213,161.00
City construction tax 16,862,415.25 11,211,699.26
Extra charge for education 12,089,201.44 8,028,992.56
Property House Tax of investment real estate 8,850.24 -
Price adjustmet fund 9,982.41 -
Embankment fee 60,166.03 -
River maintainance fee 5,000.00 -
Total 43,172,959.76 19,453,852.82
Business tax and extra charges gwroth 121.92% over same period of last year, mainly due to the increase of
business tax and extra charges have been paid in period.
166
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
36. Sales expense
Amount at same period
Item Amount at this period
of last year
Market support 339,055,305.97 332,026,794.94
Transport expenses 199,129,238.65 182,289,436.10
National three guarantees expense 46,931,957.86 66,726,845.17
Accrued expense of 10-year guarantee for county-oriented
36,632,756.61 67,653,978.00
appliance
Salary and extra charges 85,033,757.52 71,641,628.47
Social security 7,843,124.70 6,232,141.96
Public reserve 1,335,609.15 1,804,929.55
Advertisement expenses 30,090,962.25 45,483,220.37
Air conditioner installation fee 71,445,465.30 95,697,936.42
Operation activities expenses 7,552,947.70 8,342,091.28
Exhibition expenses 19,644,900.61 27,735,395.97
Storage lease expenses 38,272,491.42 29,815,327.56
Travelling expenses 12,001,834.82 12,931,053.87
Meeting organization 4,619,066.14 6,662,076.03
House-lease expenses 3,352,543.45 4,999,637.90
Communication expenses 3,066,357.33 3,173,313.24
Consumption of machinery materials 2,397,756.34 3,412,457.85
Office expenses 795,599.73 1,517,758.02
Consumption of machinery materials 9,388.91 1,332,676.94
Depreciation expenses 1,807,933.25 1,683,199.36
Other expenses 26,838,501.26 9,813,654.78
Total 937,857,498.97 980,975,553.78
37. Administration expense
Amount at same period
Item Amount at this period
of last year
Salary and surcharge 56,171,855.72 40,525,932.53
Social insurance and Public Housing Reserve Fund 13,006,755.63 11,673,885.96
Amortized intangible assets 11,766,359.78 20,056,465.44
Taxes 10,457,725.59 9,222,727.52
Trial fee of R&D 9,417,303.98 7,131,665.02
Dismiss welfare 7,548,716.51 9,824,271.02
Depreciation 7,347,161.52 7,745,818.63
Business activity cost 4,255,274.65 1,759,396.51
Domestic travelling fee 3,650,680.99 1,841,605.79
Utilities 3,509,287.66 1,642,772.76
167
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at same period
Item Amount at this period
of last year
Business cost 2,793,770.21 1,738,572.15
Inspection and authentication fee 2,056,761.15 1,962,781.39
Assets leasing 674,742.69 651,961.76
Funds of Board 556,666.22 642,980.44
Property insurance 411,832.29 1,566,730.34
Use chage of software 400,752.79 517,592.99
Other 24,885,894.38 25,039,003.97
Total 158,911,541.76 143,544,164.22
38. Financial expense
Amount at same period
Item Amount at this period
of last year
Interest expenditure 4,219,580.96 4,204,824.66
Less: Interest income 11,932,542.50 7,494,271.83
Add: exchange loss -10,711,606.88 1,093,505.60
Add: procedure charge expenditure 2,325,279.14 2,751,113.85
Add: discount expenditure -17,447,220.62 -16,991,034.30
Add: other expenditure -1,040,468.55 1,195,220.44
Total -34,586,978.46 -15,240,641.58
Financial expense gains a y-o-y down of 126.94%, mainly because the interest income increase in
the period for fund-raised and income from foreign exchange increased.
39. Loss from Assets depreciation
Amount at this Amount at same
Item
period period of last year
Bad debt losses 17,856,046.92 20,768,659.31
Provision for falling price of inventory 19,263,644.39 2,328,940.97
Provision for devaluation of fixed assets - -
Provision for devaluation of construction in progress - -
Provision for devaluation of goodwill - -
Total 37,119,691.31 23,097,600.28
Loss from Assets depreciation gains a y-o-y growth of 60.71%, maily because the accurred bad debt
provision and depreciation for ivnentroy increased in this period, which was withdrwal according to
the accounting rules and company’s accounting policy as well as real account receivable and
inventory.
40. Investment income
(1)Sources of investment income
Amount at this Amount at same
Item
period period of last year
Long-term equity investment income by cost method 1,073,757.30 267,003.27
168
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Long-term equity investment income by equity method -812,793.39 -136,457.31
Investment income from disposal of long-term equity
- 201,850.28
investment
Investment income from period of holding financial
- -
assets available for sale
Investment income from disposal of financial assets
- -
available for sale
Total 260,963.91 332,396.24
(2) Long-term equity investment income by cost method
Amount at same
Amount at this
Item period of last Remark
period
year
Huishang Bank Co., Ltd. 1,073,757.30 - -
consolidated as
Chaohu Meiling Appliance Marketing Co., subsidiary after
- 267,003.27
Ltd. acquisition of
other equity
Total 1,073,757.30 267,003.27 -
(3) Long-term equity investment income by equity method
Amount at same
Amount at this
Item period of last Remark
period
year
Hefei Meiling Sole Energy Science &
-768,399.40 -136,457.31 -
Technology Co., Ltd.
Changhong Ruba Electric Company
-220,191.66 - -
(Private) Ltd.
Hefei Xingmei Assets Management Co.,
175,797.67 - -
Ltd.
Total -812,793.39 -136,457.31 -
41. Non-operation revenue
(1)Details about non-operation revenue
Amount at this Amount at same
Item
period period of last year
Gains from disposal of non-current assets 152,002.92 10,974,329.05
Incl.：gains from disposal of fixed assets 152,002.92 33,513.74
gains from disposal of Intangible assets - 10,940,815.31
Government subsidy 4,237,836.91 108,247,649.58
Income of penalty 144,666.02 249,707.16
Others 45,143.59 70,964.26
Total 4,579,649.44 119,542,650.05
Non-operation revenue gains a y-o-y down of 96.17%, mainly due to the subsidy of energy-saving
and beneficial to people has not been received by subsidiary Sichun Air-Conditioner in the period.
(2)Details about government subsidy
169
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at same
Amount at this
Item period of last Sources and accordance
period
year
Funds of maintaining stable growth ”Award Policy for Promoting the Stable and
- 513,874.00
in foreign trade Fast Development of Indusry Economy”
deferred income transfer-in 1,227,304.11 625,334.42
Notice of Specific Using Plan (2nd group) of
Subsidy for fixed assets - 226,286.00 Enviornment Protection for year of 2009 in
Hefei（HH[2009]No.:157）
Ministry of Fiannce, NDRC[CJ（2009）
Subsidy in favour of energy-saving No.213 号]; Ministry of Fiannce,
- 105,114,545.73
air conditioner NDRC[2009 No.:5] and [2009 No.:6]
Tax paid back 510,000.00 326,353.18 GXCZJ
subsidiy for absorb and
451,956.25
re-innovation
A one-time award from ecelletn R&D institution newly appointed and
359,000.00 -
enterprise tech. center evaluation excellent awards
A one-time award for participated
300,000.00 - Standard regulation awards
the regulation of national standards
Foreign talent appointment subsidy 250,000.00 - Policy Notice: HZ[2011] No. 54
Subsidy for Key technology
innovation for year of 2011 in 300,000.00 - MCJ【2011】No.217
Mianyang
Industry development of precision
and efficiency temperature
500,000.00 - MKF【2012】No. 17
–controoling DC variable
air-conditioner
Other spare government subsidy 791,532.80 989,300.00
Total 4,237,836.91 108,247,649.58
42. Non-operating expenditure
Amount at this Amount at same
Item
period period of last year
Loss from disposal of non-current assets 5,333,936.81 1,884,529.38
Incl.：loss from disposal of fixed assets 5,333,936.81 1,884,529.38
loss from disposal of Intangible assets - -
External donation - -
Penalty and late fee 196,241.46 174,850.08
Others 95,640.53 83,949. 02
Total 5,625,818.80 2,143,328.48
170
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Non-operating expenditure gains a y-o-y growth of 162.48% mainly due to the abendent losses for
fixed assets increased in this period.
43. Income tax expenses
Amount at this Amount at same
Item
period period of last year
Current income tax 31,829,543.35 44,148,538.56
Deferred Income Tax -17,963,582.33 -26,012,646.78
Total 13,865,961.02 18,135,891.78
Current income tax
Item Amount
Total consolidated profit this year 125,373,406.07
Add: Combined offset 14,665,866.31
Add: Amount increased by taxation adjustment 55,703,402.90
Less: Amount decreased by taxation adjustment 2,831,423.36
Add: Domestic deficit coverage by overseas taxable income -
Less: Deficit coverage for previously years 2,436,955.17
Add: Deficit of subsidiary this year 14,494,071.90
Amount of taxation income this period 204,968,368.65
Including: 25% rate applicable 10,842,880.52
15% rate applicable 194,125,488.13
Income tax paid this period 31,829,543.35
Including: 25% rate applicable 2,710,720.13
15% rate applicable 29,118,823.22
Less: Deduction amount of income tax -
Less: Offset amount of income tax -
Tax payable this period 31,829,543.35
Add: Income tax payable for over sea’s income -
Less: Income tax offset for over sea’s income -
Add: Other adjustment factor -
Current income tax 31,829,543.35
44.Calculation for basic earnings per share and diluted earnings per share
Amount at same
Amount at this
Item Serials period of last
period
year
Net profit attributable to shareholders of parent company 1 110,855,042.20 126,157,996.21
Non-recurring gains and losses attributable to parent
2 -781,743.71 10,303,133.16
company
171
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at same
Amount at this
Item Serials period of last
period
year
Net profit attributable to shareholders of parent company
3=1-2 111,636,785.91 115,854,863.05
after deduction of non-recurring gains and losses
Total shares at the beginning of the year 4 636,449,338.00 530,374,449.00
Additional share capital transferred from public reserve or
5 -
additional shares from shares dividend distribution (I)
Additional shares from issuing new shares or
6
debt-converted shares(II)
Accumulative months of the additional shares(II) commencing
from the next month till the end of the year
Item
1. gains (losses) arising from financial assets available for
Less: affect of income tax arising from financial asse
sale
Net, written in other comprehensive income in p
and carried forward to gains and losses in current period
Subtotal
2. Share in other comprehensive income of invested u
method
Less: affect of income tax arising from Share in other
income of invested units by equity method
Net, written in other comprehensive income in previ
carried forward to gains and losses in current period
Subtotal
3. gains (losses) arising from cash flow hedge instruments 7
Less: affect of income tax arising from cash flow hedg
Net, written in other comprehensive income in previ
carried forward to gains and losses in current period
Adjustment, converted to initial recognization amount
hedge
Subtotal
4. Conversion difference arising from foreign curr
statement
Less: net, carried forward to gains and losses in curre
disposing overseas operation
Subtotal
5. Others
Less: affect of income tax arising from others which
other comprehensive income
Net, others written in other comprehensive income in p
and carried forward to gains and losses in current period
Subtotal
Total
Decreased shares due to repurchase 8
172
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at same
Amount at this
Item Serials period of last
period
year
Accumulative months of the decreased shares commencing
9
from the next month till the end of the year
Decreased shares due to share shrink 10
Mouths during the report period 11
Weighted average of ordinary shares issued 12=4+5+6×7÷11-8×9÷11-10 636,449,338.00 530,374,449.00
Basic earnings per share(I) 13=1÷12 0.1742 0.2379
Basic earnings per share(II) 14=3÷12 0.1754 0.2184
Diluted potential ordinary shares dividend recognized as expense 15
Conversion expense 16
Income tax rate 17 15% 15%
weighted average of ordinary shares added through warrant,
18
exercise of option and convertible bonds
19=[1+(15-16)×(1-17)]÷(12+1
Diluted earnings per share(I)
8)
0.1742 0.2379
20=[3+(15-16)×(1-17)]÷(12+1
Diluted earnings per share(II)
8) 0.1754 0.2184
45.Other comprehensive income
46. Items to cash flow statement
(1) Cash received (paid) from (for) other activities relating to operation/investment/financing
1) Cash received from other activities relating to operation
Item Amount at this period
Bid security/deposit received 5,292,513.37
Insurance compensation received 4,873,115.55
Other 2,627,646.55
Total 12,793,275.47
2) Cash paid for other activities relating to operation
Item Amount at this period
Market support fee paid 80,955,567.71
Advertisement paid 30,226,942.65
Exhibition charge paid 21,523,693.50
Living expenses for intern paid 19,316,260.40
Domestic business travelling fee paid 17,342,559.01
Business activity paid 12,046,853.12
Employee’s reserve fund paid 9,567,318.63
Rents paid 7,503,332.44
Routine buses charge 4,723,338.98
Others paid 69,063,273.99
Total 272,269,140.43
173
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
3) Cash received from other activities relating to investment
Item Amount at this period
Interest income arising from bank savings 11,890,911.45
Bidding margins from construction projects -5,719,708.32
Total 6,171,203.13
4) Cash paid for other activities relating to investment: Nil.
5) Cash received from other activities relating to financing: Nil.
6) Cash paid for other activities relating to financing: Nil
(2)Supplementary information about consolidated cash flow statement
Amount at same
Amount at this
Item period of last
period
year
1 . Net profit is adjusted to cash flow of operation activities:
Net profit 111,507,445.05 121,327,936.65
provision for depreciation of assets 37,119,691.31 23,097,600.28
Depreciation of fixed assets, consumption of oil gas assets
52,284,463.48 60,809,710.71
and depreciation of productive biological assets
Amortization of intangible assets 23,483,817.85 20,521,678.01
Amortization of long-term retained expense - -
Loss from disposal of fixed assets, intangible assets and other
-34,755.69 -9,089,799.67
long term assets(gain is listed with “-”)
Loss from discarding fixed assets as useless (gain is listed with
5,216,689.58 -
“-”)
Loss from change of fair value(gain is listed with “-”) - -
Financial expense (gain is listed with “-”) -7,712,961.54 -15,240,641.58
Investment loss (gain is listed with “-”) -260,963.91 -332,396.24
Decrease of deferred income tax assets (increase is listed with
-17,963,582.33 -26,012,646.78
“-”)
Increase of deferred income tax liabilities (decrease is listed
- -
with “-”)
Decrease of inventories (increase is listed with “-”) 378,701,851.04 -126,385,347.03
Decrease of operational accounts receivable (increase is listed
-1,383,917,065.74 -1,632,961,065.03
with “-”)
Increase of operational accounts payable (decrease is listed
541,031,080.37 1,039,931,274.87
with “-”)
Others - -
Net cash flow arising from operation activities -260,544,290.53 -544,333,695.81
2. Significant investment and financing activities with no
reference to cash collection and payment:
Debt convert to capital - -
174
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Convertible bond due within one year - -
Fixed assets leased in by financing - -
3. Net change in cash and cash equivalent:
Balance of cash at period-end 1,166,845,074.91 1,479,457,104.15
Less: Balance of cash at period-begin 1,401,674,679.41 1,986,440,504.29
Add: Balance of cash equivalent at period-end - -
Less: Balance of cash equivalent at period-begin - -
Net increase in cash and cash equivalent -234,829,604.50 -506,983,400.14
(3)Relevant information about acquiring or disposing subsidiaries or other operation units in
previous years
Amount at same
Amount at this
Item period of last
period
year
Relevant information about acquiring subsidiaries or other
operation units
1. Price for acquiring subsidiaries or other operation units - 1,647,467.25
2. Cash and cash equivalent paid for acquiring subsidiaries or
- 1,647,467.25
other operation units
Less: Cash and cash equivalent held by subsidiaries or
- 668,779.28
other operation units
3. Net cash paid for acquiring subsidiaries or other operation
- 978,687.97
units
4. Acquiring net assets of subsidiaries - -
Current assets - -
Non-current assets - -
Current liabilities - -
Non-current liabilities - -
Relevant information about disposing subsidiaries or other
operation units
1. Price for disposing subsidiaries or other operation units - -
2. Cash and cash equivalent received from disposing
- -
subsidiaries or other operation units
Less: Cash and cash equivalent held by subsidiaries or other
- -
operation units
3. Net cash received from disposing subsidiaries or other
- -
operation units
4. Disposing net assets of subsidiaries - -
Current assets - -
Non-current assets - -
Current liabilities - -
Non-current liabilities - -
175
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
(4)Cash and cash equivalent
Amount at same
Amount at this
Item period of last
period
year
1,166,845,074.
Cash 1,479,457,104.15
91
Including: stock cash 1,073,493.68 1,836,692.45
Bank deposit available for payment at any time 860,055,857.75 1,124,042,167.14
Other monetary capital available for payment at any time 305,715,723.48 353,578,244.56
Deposit in central bank available for payment - -
Deposit from other banks - -
Call loans to banks - -
Cash equivalent - -
Including: bond investment due within 3 months - -
1,166,845,074.
Balance of cash and cash equivalent at period-end 1,479,457,104.15
91
Including: restricted cash and cash equivalent used by parent
305,715,723.48 353,578,244.56
company or subsidiaries
47. Items to statement of change of shareholders’ equity
(1) “Other ” items of amount at end of last year : Nil
(2)Other projects with significant amount in “III. (VII) Other ” items listed in Statement of Changes
of Shareholders’ Equity: Nil
IX. Related parties and related transaction
(I)Relationship of related parties
1. Controlling shareholder and terminal controller
(1) Controlling shareholder and terminal controller
Controlling shareholder and Type of Place of Nature of Legal
Organization code
terminal controller entity registrati business represent
Manufact i
Sichuan Changhong Electric Stock Zhao
Mianyang ure and 20541230-8
Co., Ltd. company Yong
sales
Sichuan Changhong Electronic Limited Manufact Zhao
Mianyang 72081866-0
Group Co., Ltd. company ure and Yong
(2) Register capital and change thereof of controlling shareholder
Increase Decrease
Amount at Amount at
controlling shareholder during the during the
year-begin period-end
period period
Sichuan Changhong Electric
4,616,244,222 - - 4,616,244,222
Co., Ltd.
(3)Shares held by the controlling shareholder and its changes on equity (including shares held
directly/indirectly)
176
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount of shares held Shareholding ratio（%）
controlling shareholder Amount at Amount at Amount at Amount at
period-end year-begin period-end year-begin
Sichuan Changhong Electric
158,328,461 156,839,461 24.88 24.64
Co., Ltd.
2. Subsidiaries
More details found in Annotation VII.
3.Associatedenterprises
Type Place of Legal Shareholding ratio
Nature of Registere Organizatio
Invested units of registratio representativ Period-en Year-begi
business d capital n code
entity n e d n
ChanghongRub
a Electric Privately Manufactures USD 4
Limited Pakistan - 40.00% 40.00% -
Company and sales million
company
(Private)Ltd.
Hefei Xingmei Limite Managemen
Assets d t of real RMB
Hefei Huang Youzhi 48.28% 48.28% 57851196-6
Management liabilit estate, 1million
Co., Ltd. y leasing
Hefei Meiling Sole
Energy Science & Limited Feidong Manufactures RMB
Ren Sheming 32.75% 32.75% 73733490-2
Technology Co., company County and sales 9.5million
Ltd.
4. Other related parties
Type of relation Related parties Main business Organization code
PT.CHANGHONGELECTRIC INDONESIA Sales -
Chengdu Lejiayi Commercial & Trade Co.,
Sales 79782546-3
Ltd.
Fuzhou Lejiayi Commercial & Trading Co.,
Sales 67652028-4
Ltd.
Guangdong Changhong Electrical Co., Ltd. Sales 78940429-8
Other enterprises Guangdong Changhong Digital Technology
Utilities provided 78940429-8
under control from Co., Ltd.
the same controlling Guiyang Lejiayi Commercial & Trade Co.,
Sales 67071455-5
shareholders or Ltd.
terminal controller Hefei Changhong Industrial Co., Ltd. Sales 66621592-1
Huayi Compressor Co., Ltd. Purchase 70562223-x
Jinan Lejiayi Commercial & Trading Co., Ltd. Sales 67227469-6
Jiangxi Changhong Electrical Science &
Sales 667483178
Technology Development Co., Ltd.
Kunming Yijiahong Commercial & Trade Co.,
Sales 67656328-4
Ltd.
177
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Lejiayi Chain Management Co., Ltd. Sales 66535156-9
Mianyuan Hongfa Technology Co., Ltd Purchase 79582077-3
Mianyang Lejiayi Commercial & Trade Chain
Sales 665391552
Co.,Ltd.
081 Electric Group Sichuan Liyuan Electronic
Purchase 205809540
Co., Ltd
Sichuan COC Display Devices Co., Ltd. Sales 66275681-9
Sichuan Hongrui Electrics Co., Ltd. Purchase 68237616-X
Sichuan Hongshi Display Technology Co., Ltd. Sales 66968647-0
Sichuan Hongxin Software Co., Ltd. Purchase 671440445
Sichuan Changhong Packing Printing Co., Ltd. Purchase 79399834-0
Sichuan Changhong Power Supply Limited Purchase 205418582
Sichuan Changhong Electrical System Limited Purchase 779839036
Sichuan Changhong Jijia Precision Co., Ltd. Purchase 793998375
Sichuan Changhong Precise Electrical Science
Purchase 79399836-7
& Technology Co., Ltd.
Sichuan Changhong Minsheng Logistics Purchase,
79785892-7
Limited Company transportation
Sichuan Changhong Mould Plastic Technology
Purchase 782291526
Co., Ltd.
Sichuan Changhong Equipment Science &
Purchase 793998359
Technology Co., Ltd.
Sichuan Changhong New Energy Science &
Purchase 79399394-5
Technology Co., Ltd.
Mianyang Hongrun Electrical Co., Ltd. Purchase 769966197
Taiyuan Lejiayi Commercial & Trading Co.,
Sales 779841582
Ltd.
CHANGHONG ELECTRIC MIDDLE EAST
Sales -
FZE
Changhong (Hong Kong) Trading Co., Ltd. Sales -
Changhong Appliance (Australia) Co., Ltd. Sales -
Sichuan Service Exp. Appliance Service Chain
Purchase, Sales 66744793
Co., Ltd.
Sichuan Changhong Gerun Renewable
Sales 556427608
Resources Co., Ltd.
Zhongshan Changhong Mould Plastic Science
Purchase 69226840
& Technology Co., Ltd.
Chongqing Hong Life Commercial & Trade
Sales 69226840
Co., Ltd.
Jindezhen Honghua Appliance Components
Purchase 67497863-8
Co., Ltd.
178
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Sichuan Changhong Dongyuan Precise
Purchase 795816686
Equipment Co., Ltd.
Sichuan Hongyu Metal Manufacture Co., ltd. Purchase 665361804
Sichuan Jinghong Packing Product Co.,Ltd. Purchase 779814584
Associates of Sichuan Changhe Technology Co., Ltd. Purchase 777909555
controlling Sichuan Changxin Refrigeration Parts Co., Ltd. Purchase , Sales 779841582
shareholders and BVCH Optronics (Sichuan) Co., Ltd. Purchase 69226840-2
actual controllers Sichuan Huafeng Enterprise Group Co., Ltd. Sales 20540125-4
Sichuan Changhong International Hotel Co.,
Sales 720818652
Ltd.
Sichuan Changhong Xinrui Technology
Purchase 66276762-2
Co.,Ltd.
Guangyuan Meiling Appliance Marketing Co.,
Sales 69915460-0
Ltd.
Changzhou Meiling Appliance Marketing Co.,
Sales 55026803-6
Ltd.
Guangxi Meiling Household Appliance Co.,
Joint-ventures and Sales 55225094-8
Ltd.
associates of
Haozhou Meiling Appliance Marketing Co.,
subsidiaries Sales 69896652-7
Ltd.
Xuancheng Meiling Appliance Marketing Co.,
Sales 55631828-4
Ltd.
Jiujiang Meiling Appliance Marketing Co., Ltd. Sales 69609608-9
Buyang Meiling Appliance Marketing Co., Ltd. Sales 56635286-5
(II)Related transaction
1. Purchase commodities
Amount at this period Amount at same period
Type of related parties and names of related parties
(RMB0’000) of last yare (RMB0’000)
Controlling shareholder and terminal controller
Including: Sichuan Changhong Electric Co., Ltd. 4,635.26 4,325.87
Other enterprises under control from the same
controlling shareholder or terminal controller
Including: Huayi Compressor Co., Ltd. 24,145.85 27,599.97
Sichuan Changhong Mould Plastic Technology Co., Ltd. 13,502.88 22,273.94
Sichuan Changhong Jijia Precision Co., Ltd. 9,710.39 6,469.11
Mianyuan Hongfa Technology Co., Ltd - 3.52
Sichuan Changhong Packing Printing Co., Ltd. 1,454.17 1,380.62
Sichuan Changhong Precise Electrical Science &
144.38 86.83
Technology Co., Ltd.
Sichuan Changhong Equipment Science & Technology Co.,
688.76 1,315.90
Ltd.
081 Electric Group Sichuan Liyuan Electronic Co., Ltd 374.66 526.56
179
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Sichuan Changhong New Energy Science & Technology
33.42 39.70
Co., Ltd.
Mianyang Hongrun Electrical Co., Ltd. 439.46 724.98
Guangdong Changhong Electrical Co., Ltd. 23.57 46.76
Zhongshan Changhong Mould Plastic Science &
9.84 31.97
Technology Co., Ltd.
Jindezhen Honghua Appliance Components Co., Ltd. 111.13 -
Associates of controlling shareholders and actual
controllers:
Including: Sichuan Changhong Dongyuan Precise
508.78 2,118.58
Equipment Co., Ltd.
Sichuan Changhe Technology Co., Ltd. 86.35 78.47
Sichuan Changxin Refrigeration Parts Co., Ltd. 5,442.90 8,227.50
Sichuan Jinghong Packing Product Co.,Ltd. 749.97 1,697.76
Sichuan Hongyu Metal Manufacture Co., ltd. 11.92 45.79
Total 62,073.69 76,993.83
Concerning good purchasing of the Company, bidding purchase for goods with over RMB 10,000
while bargaining purchase for goods with less than RMB 10,000. The related parties and
non-related parties all in the procedures of bidding with the same pricing policy
2. Sales of commodities
Amount at same period of
Amount at this period
last yare
Type of related parties and names of related parties
Ratio Ratio
Amount(RMB0’000) Amount(RMB0’000)
(%) (%)
Controlling sharehohlders and terminal controller
Including: Sichuan Changhong Electric Co., Ltd. 77,224.47 14.54 62,871.58 11.49
Other enterprises under same control from controlling
shareholders and terminal controller
Including: PT.CHANGHONG ELECTRIC IND 3,563.76 0.67 48.33 0.01
Sichuan Changhong Jijia Precision Co., Ltd. 1,304.50 0.25 2,102.69 0.38
Sichuan Changhong Mould Plastic Technology Co.,
2,374.22 0.45 5,290.03 0.97
Ltd.
Sichuan Hongshi Display Technology Co., Ltd. - - 105.59 0.02
Mianyang Lejiayi Commercial & Trade Chain
2.85 0.00 464.51 0.08
Co.,Ltd.
Sichuan Changhong Precise Electrical Science &
52.17 0.01 - -
Technology Co., Ltd.
Hong Kong (Changhong) Trade Co., Ltd. 11.60 0.00 - -
Chongqing Hong Life Commercial & Trade Co.,
100.36 0.02 82.11 0.02
Ltd.
Huayi Compressor Co., Ltd. - - 2.74 0.00
Fuzhou Lejiayi Commercial & Trading Co., Ltd. - - 0.20 0.00
180
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Jinan Lejiayi Commercial & Trading Co., Ltd. - - 1.65 0.00
Sichuan Hongrui Electrics Co., Ltd. 1.12 0.00 - -
Sichuan Changhong New Energy Science &
0.17 0.00 41.09 0.01
Technology Co., Ltd.
Sichuan Changhong Packing Printing Co., Ltd. - - 0.38 0.00
Guangdong Changhong Digital Technology Co.,
0.40 0.00 - -
Ltd.
Sichuan Changhong Minsheng Logistics Limited
30.90 0.01 23.85 0.00
Company
Taiyuan Lejiayi Commercial & Trading Co., Ltd. - - 0.00 0.00
Wandao Network Technology Co., Ltd. 77.19 0.01 113.53 0.02
Sichuan Changhong Gerun Renewable Resources
8.32 0.00 13.53 0.00
Co., Ltd.
Lejiayi Chain Management Co., Ltd. 1,780.16 0.34 - -
Changhong Appliance (Australia) Co., Ltd. 1,693.62 0.32 1,012.98 0.19
CHANGHONG ELECTRIC MIDDLE EAST FZE 945.77 0.18 - -
Sichuan Changhong International Hotel Co., Ltd. - - 26.41 0.00
Sichuan Service Exp. Appliance Service Chain Co.,
122.75 0.02 264.84 0.05
Ltd.
Zhongshan Changhong Mould Plastic Science &
15.10 0.00 27.19 0.00
Technology Co., Ltd.
Controlling shareholders and associated enterprise of
actual controller
Including: Sichuan Changhong Dongyuan Precise
0.21 0.00 - -
Equipment Co., Ltd.
BVCH Optronics (Sichuan) Co., Ltd. - - 30.00 0.01
Sichuan Changhong Xinrui Technology Co.,Ltd. - - 167.59 0.03
Associated and joint-venture
Including: Guangyuan Meiling Appliance Marketing Co.,
940.80 0.18 1,318.83 0.24
Ltd.
Changzhou Meiling Appliance Marketing Co., Ltd. 663.68 0.12 1,149.93 0.21
Guangxi Meiling Household Appliance Co., Ltd. 6,388.11 1.20 7,642.73 1.40
Haozhou Meiling Appliance Marketing Co., Ltd. 2,031.61 0.38 2,161.30 0.39
Xuancheng Meiling Appliance Marketing Co., Ltd. 1,969.47 0.37 2,247.09 0.41
Jiujiang Meiling Appliance Marketing Co., Ltd. 2,590.86 0.49 4,123.74 0.75
Buyang Meiling Appliance Marketing Co., Ltd. 10,093.84 1.90 6,561.33 1.20
Total 113,988.01 21.46 97,895.77 17.88
Business contacts with related parties are perfom under normal market business regulation and have
the same situation towards other enterprises. Concerning the price purchase/sales and other labour
provided between the Companies and relate parties, pricing according to national price, if
applicable; pricing according to market price if without no national pricing and without marketing
pricing, than the price will negotiated by two parties due to the principle of actual cost plus
reasonable expenses. The two parties will negotiated the price on special service while suiting no
181
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
the principle of “Cost plus expense”.
3.Rentofrelatedparties
Leasing
Type of
Date of Pricing basis for income
Lessor Lessee assets Date of end
starting leasing recognized in
leasing
this year
Sichuan Changhong
Hefei Meiling Worksh Contract of
Mould Plastic Technology 2012-1-1 2012-12-31 647,190.00
Co., Ltd. op workshop leasing
Co., Ltd.
Hefei Meiling Sichuan Changhong Jijia Worksh RMB 12/m2 per
2012-1-1 2012-12-31 233,280.00
Co., Ltd. Precision Co., Ltd. op month
Zhongshan
Changhong Guangdong Changhong Office RMB 10.96 / m2
2012-1-1 2012-12-31 101,642.40
Appliance Co., Electrical Co., Ltd. building per month
Ltd.
Zhongshan
Guangdong Changhong
Changhong Office RMB 10.96 / m2
Digital Technology Co., 2012-1-1 2012-12-31 11,828.70
Appliance Co., building per month
Ltd.
Ltd.
Zhongshan Sichuan Changhong
Changhong Minsheng Logistics Office RMB 10.96 / m2
2012-1-1 2012-12-31 2,208.06
Appliance Co., Limited Company 中山分 building per month
Ltd. 公司
Zhongshan
Zhongshan Changhong
Changhong Office RMB 10.96 / m2
Mould Plastic Science 2012-1-1 2012-12-31 12,668.94
Appliance Co., building per month
& Technology Co., Ltd.
Ltd.
Zhongshan
Sichuan Service Exp.
Changhong Office RMB 8.50 / m2 per
Appliance Service Chain 2012-1-1 2012-12-31 174,420.00
Appliance Co., building month
Co., Ltd.
Ltd.
Sichuan
Changhong Sichuan Changhong Equipm
2012-1-20 2013-1-19 Leasing Contract 19,331.19
Air-Conditioner Jijia Precision Co., Ltd. ent
Co., Ltd.
Sichuan
Sichuan Changhong
Changhong Equipm
Mould Plastic 2012-1-1 2012-12-31 Leasing Contract 4,739.33
Air-Conditioner ent
Technology Co., Ltd.
Co., Ltd.
182
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Sichuan
Changhong BVCH Optronics Equipm
2011-10-1 2012-12-31 Leasing Contract 24,658.36
Air-Conditioner (Sichuan) Co., Ltd. ent
Co., Ltd.
Sichuan
Changhong BVCH Optronics Equipm
2012-6-1 2012-12-31 Leasing Contract 1780.88
Air-Conditioner (Sichuan) Co., Ltd. ent
Co., Ltd.
4. Lessee of related parties
Leasing
Type of
Date of Pricing basis for income
Lessor Lessee assets Date of end
starting leasing recognized in
leasing
this year
Sichuan
Sichuan Changhong
Changhong Contract of assts
Air-Conditioner Co., Workshop 2012-1-1 2012-12-31 3,229,132.54
Electric Co., leasing
Ltd.
Ltd.
Sichuan
Changhong
Minsheng Mianyang Meiling Contract of
Workshop 2010-1-1 2029-12-31 3,076,962.00
Logistics Refrigeration Co., Ltd. workshop leasing
Limited
Company
5. Related guarantee
Whet
her
Ceiling Date start Due date
imple
Party providing guarantee Party receiving guarantee guarantee for for
mente
amount guarantee guarantee
d or
not
88.88
Sichuan Changhong
HefeiMeilingCo.,Ltd. million 2011-11-28 2012-5-27 Yes
Air-Conditioner Co., Ltd.
Yuan
Zhongshan Changhong 50 million
Hefei Meiling Co., Ltd. 2012-4-23 2013-4-22 No
Appliance Co., Ltd. Yuan
Hefei Meiling Nonferrous Metal Products 17 million
Hefei Meiling Co., Ltd. 2011-7-19 2012-6-29 Yes
Co.,Ltd. Yuan
Hefei Meiling Nonferrous Metal 7 million
Hefei Meiling Co., Ltd. 2011-6-29 2012-6-29 Yes
Products Co., Ltd. Yuan
Hefei Meiling Group Holding 4 million
MeilingEquatorAppliance(Hefei)Co.,Ltd. 2009-6-22 2012-6-22 Yes
Co., Ltd. Yuan
2 million
HefeiMeilingGroupHoldingCo.,Ltd. HefeiEquatorApplianceCo.,Ltd. 2009-6-22 2012-6-22 Yes
Yuan
Sichuan Changhong Hefei Meiling Co., Ltd. 80 million 2010-6-15 2012-6-15 Revoke
183
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Air-Conditioner Co., Ltd. Yuan d
Sichuan Changhong Electronic 80 million Revoke
Hefei Meiling Co., Ltd. 2010-5-15 2012-5-15
Group Co., Ltd. Yuan d
The aforementioned warrantees are the Company’s wholly-owned or controlling subsidiaries. These
companies run normally, bringing no negative influence on the Company’s financial status. In the
report period, guarantee ceiling provided to subsidiary by the Company amounting to RMB 486
million, RMB 168.88 million was actually guarantee and actual guarantee balance at period-end
was RMB 50 million. For the abovementioned guarantee, subordinate subsidiary Meiling Group
provided ceiling guarantee RMB 6 million to Meiling Yingkaite Appliance (Hefei) Co., Ltd. and
Hefei Yingkaite Appliance Co., Ltd. with actually guarantee of RMB 0. The guarantee was formed
in history before 100% equity of Meiling Group was transferred by agreement. The guarantee was
expired till end of this report period.
6.Assetstransferofrelatedparties
Type of related Amount at this Amount at same
Name of related parties
transaction period period of last yare
Sichuan Changhong Precise 31,881.37
Fixed assets
Electrical Science & Technology Co., -
purchased
Ltd.
Sichuan Changhong Electric Co., Fixed assets 645,025.00
-
Ltd. purchased
Sichuan Hongxin Software Co., Ltd. Fixed assets - 840,000.00
purchased
Total 676,906.37 840,000.00
Sichuan Changhong Minsheng Fixed assets transfer 1,515,429.10
-
Logistics Limited Company
Total 1,515,429.10 -
7. Receive labour services
Amount at same
Labour services providers Amount at this period
period of last yare
Sichuan Changhong Electric Co., Ltd. 4,866,889.82 3,129,011.66
Sichuan Hongxin Software Co., Ltd. 1,300,000.00 400,000.00
Sichuan Service Exp. Appliance Service 27,936,717.65 29,722,014.22
Chain Co., Ltd.
Sichuan Changhong Minsheng Logistics 137,507,322.33 70,462,292.20
Limited Company
Total 171,610,929.80 103,713,318.08
8. Water & power supply
Amount at same
Related parties(receiving party) Amount at this period
period of last yare
Guangdong Changhong Electrical Co., Ltd. 375,113.52, 260,666.19
184
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Guangdong Changhong Digital Technology
67,803.38 57,631.71
Co., Ltd.
Sichuan Changhong Minsheng Logistics
18,270.58 13,141.52
Limited Company
Sichuan Service Exp. Appliance Service
16,020.87 1,541.42
Chain Co., Ltd.
Zhongshan Changhong Mould Plastic
2,830.71 -
Science & Technology Co., Ltd.
Total 480,039.06 332,980.84
9. Water & power received
Amount at same
Related parties(provider) Amount at this period
period of last yare
Sichuan Changhong Electric Co., Ltd. 6,175,194.03 -
Total 6,175,194.03 -
10. Trademark licensing authorized by related parties, patent implementation permit
On 1 June 2010, the proposal of “Trademark Licensing Contract” signed between Sichuan
Changhong Air-conditioner Co., Ltd and Sichuan Changhong Electric Co., Ltd. has been approved
by 34th Meeting of 6th Session of the Board. Allow controlling subsidiary – Changhong
Air-conditioner entered into the “Trademark Licensing Contract” with Sichuan Changhong. The
contract agrees that: under the premise of being the controlling shareholder of Hefei Meiling Co.,
Ltd., Sichuan Changhong, and being the controlling shareholder of Changhong Air-conditioner,
Hefei Meiling Co., Ltd., the trademark owner, Sichuan Changhong, will authorize the trademark of
“Changhong” for long-term free use to Changhong Air-conditioner and Zhongshan Changhong in
products of air-conditioners and air purification equipment. Chonghong Air-conditioner will use in
the trademark registered place by regulations.
On 1 June 2010, the proposal of “Trademark Licensing Constract”signed between Zhongshan
Changhong Appliance Co., Ltd and Sichuan Changhong Electric Co., Ltd has been approved by 34th
Meeting of 6th Session of the Board. Allow controlling subsidiary – Zhongshan Changhong entered
into the “Trademark Licensing Contract” with Sichuan Changhong. The contract agrees that: under
the premise of being the controlling shareholder of Hefei Meiling Co., Ltd., Sichuan Changhong,
and being the controlling shareholder of Zhongshan Changhong, Hefei Meiling Co., Ltd., the
trademark owner, Sichuan Changhong, will authorize the trademark of “Changhong” for long-term
free use to Changhong Air-conditioner and Zhongshan Changhong in products of air-conditioners
and air purification equipment. Zhongshan Chonghong will use in the trademark registered place by
regulations.
On 1 June 2010, the proposal of “Patent Permit Contract” signed between Zhongshan Changhong
Appliance Co., Ltd and Sichuan Changhong Electric Co., Ltd has been approved by 34th Meeting of
6th Session of the Board. Allow controlling subsidiary – Zhongshan Changhong entered into the
“Patent Permit Contract” with Sichuan Changhong. The contract agrees that: under the premise of
being the controlling shareholder of Hefei Meiling Co., Ltd., Sichuan Changhong, and being the
controlling shareholder of Zhongshan Changhong, Hefei Meiling Co., Ltd., the trademark owner,
Sichuan Changhong, will authorize four patents in air-conditioner (including machine union of
air-conditioner with separation, equipment of cool-to-heat of air-conditioner, removal
air-conditioner with heat pump style and removal air-conditioner with shower style) to Zhongshan
Changhong for free use in the validity of patent. The permit and use rage are exclusively by
185
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Zhongshan Changhong, un-transference, un-permit and use in global. Zhongshan Changhong has
the rights to manufacture, use, develop and sale of the permit products.
On 10 November 2010, the 38th Meeting of 6th Session of the Board approved the followed
proposals: Sichuan Changhong Air-conditioner, entered into “Supplementary Contract of Patent
License for Implementation” with Sichuan Changhong; Zhongshan Changhong, , entered into
“Patent License Contract for Implementation” with Sichuan Changhong and Zhongshan
Changhong, entered into “Supplementary Contract of Patent License for Implementation “with
Sichuan Changhong. The contract agrees that: agreed Sichuan Changhong entered into
“Supplementary Contract of Trademark Licensing” with Changhong Air-conditioner, Zhongshan
Changhong respectively. Terminated relevant clause of free-use authorization concerning authorized
to Changhong Air-conditioner and Zhongshan Changhong. That is terminated premise of
“Sichuan Changhong being the controlling shareholder of Meiling Apparatus and Meiling
Apparatus being the controlling shareholders of Changhong Air-conditioner and Zhongshan
Changhong ”; agreed the Supplementary Contract of Patent License for Implementation signed
between Zhongshan Changhong and Sichuan Changhong, the supplementary contract stated that
terminated the relevant clause of premise of authorized Zhongshan Changhong for free-use that
listed in signed four pieces of Contract of Patent License for Implementation, that is” terminated the
premise of Sichuan Changhong being the controlling shareholders of Meiling Apparatus and
Meiling Apparatus being the controlling shareholders of Zhongshan Changhong”.
(III)Exchange balance of related parties
1. Accounts receivable of related parties
Amount at
Related parties(items ) Amount at period-end
year-begin
Controlling shareholder and terminal controller
Including: Sichuan Changhong Electric Co., Ltd. 13,031,589.47 25,257.14
Other enterprises under control from the same controlling
shareholder y or terminal controller
Including: Sichuan Hongshi Display Technology Limited - 105,000.00
Sichuan Changhong Mould Plastic Technology Co.,
3,371,621.60 2,843,178.95
Ltd.
Sichuan Changhong Minsheng Logistics Limited
149,921.00 188,428.89
Company
Sichuan Changhong Jijia Precision Co., Ltd. 0.03 233,280.04
Changhong Appliance (Australia) Co., Ltd. 19,449,664.11 9,706,173.07
Jiangxi Changhong Electrical Science & Technology
- 147,000.00
Development Co., Ltd.
Changhong (Hong Kong) Trading Co., Ltd. 115990.33 -
PT.CHANGHONG ELECTRIC INDONESIA 36,976,610.72 33,778,627.43
CHANGHONG ELECTRIC MIDDLE EAST FZE 5,690,353.10 -
Hefei Changhong Industrial Co., Ltd. 532,038.54 1,202,046.69
Huayi Compressor Co., Ltd. 3,200.43 3,200.00
Sichuan Changhong Packing Printing Co., Ltd. 1,440.00 -
Lejiayi Chain Management Co., Ltd. 8,327,879.24 -
Jinan Lejiayi Commercial & Trading Co., Ltd. 7,473.00 -
186
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Fuzhou Lejiayi Commercial & Trading Co., Ltd. 14,611.20 14,611.20
Wandao Network Technology Co., Ltd. 1,467.60 -
Sichuan COC Display Devices Co., Ltd. 131,550.04 131,550.04
Sichuan Hongshi Display Technology Limited 7,500.00 -
Sichuan Service Exp. Appliance Service Chain Co.,
733,063.24 131,073.21
Ltd.
Taiyuan Lejiayi Commercial & Trading Co., Ltd. 23,534.05 -
Chongqing Hong Life Commercial & Trade Co., Ltd. 11,707.20 -
Sichuan Changhong Precise Electrical Science &
427,288.36 -
Technology Co., Ltd.
Sichuan Changhong International Hotel Co., Ltd. 10,522.60 10,522.60
Guangdong Changhong Digital Technology Co., Ltd. 57,076.56
Associates of controlling shareholders and actual
controllers:
Including: Sichuan Changhong Dongyuan Precise Equipment
- 2,994.67
Co., Ltd.
BVCH Optronics (Sichuan) Corp. 100,100.01 100,100.01
Sichuan Changhong Xinrui Technology Co.,Ltd. 159,145.15 854,245.04
Associates and joint-venture
Including: Guangxi Meiling Household Appliance Co., Ltd. 17,492,757.60 -
Haozhou Meiling Appliance Marketing Co., Ltd. 205,580.00 -
Buyang Meiling Appliance Marketing Co., Ltd. 273,360.10 122,845.00
Changhong Ruba Electric Company (Private) Ltd. 240,587.03
Total 107,547,632.31 49,600,133.98
2. Account received in advance from relate parties
Amount at
relate parties (item) Amount at period-end
year-begin
Controlling shareholder and terminal controller -
Including: Sichuan Changhong Electric Co., Ltd. - 89,047,249.11
Other enterprises under control from the same controlling
shareholder y or terminal controller
Including: Chengdu Lejiayi Commercial & Trade Co.,
- 501.21
Ltd.
Mianyang Lejiayi Commercial & Trade Chain
33,325.01 3,125,559.07
Co.,Ltd.
Sichuan Changhong Mould Plastic Technology Co.,
- -
Ltd.
Sichuan Changhong Precise Electrical Science &
- 0.32
Technology Co., Ltd.
Sichuan Changhong Equipment Science &
0.33 0.33
Technology Co., Ltd.
Sichuan Changhong Power Supply Limited 48,000.00 -
187
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Wandao Network Technology Co., Ltd. 5,348.00 -
Chongqing Hong Life Commercial & Trade Co., Ltd. - 102,513.20
Sichuan Changhong Gerun Renewable Resources Co.,
65,831.90 -
Ltd.
Sichuan Changhong Electrical System Limited 0.40 0.40
CHANGHONG ELECTRIC MIDDLE EAST FZE - 2,503.83
Associates of controlling shareholders and actual
controllers:
Including: Sichuan Changhong Dongyuan Precise Equipment
510.45 -
Co., Ltd.
Associates and joint-venture
Including: Guangyuan Meiling Appliance Marketing Co.,
4,747,525.24 804,576.72
Ltd.
Changzhou Meiling Appliance Marketing Co., Ltd. 1,738,428.11 566,021.83
Haozhou Meiling Appliance Marketing Co., Ltd. 493,760.77 3,636,738.23
Xuancheng Meiling Appliance Marketing Co., Ltd. 3,456,209.54 4,009,727.99
Jiujiang Meiling Appliance Marketing Co., Ltd. 6,316,661.51 -
Buyang Meiling Appliance Marketing Co., Ltd. 14,318,089.47 5,807,295.25
Total 31,223,690.73 107,626,687.48
3. Account payable from related parties
Amount at
relate parties (item) Amount at period-end
year-begin
Controlling shareholder and terminal controller
Including: Sichuan Changhong Electric Co., Ltd. 47,883,784.51 58,615,813.70
Sichuan Changhong Electronic Group Co., Ltd. 215.00 -
Other enterprises under control from the same controlling
shareholder y or terminal controller
Including: Huayi Compressor Co., Ltd. 109,898,513.05 103,026,497.05
Sichuan Changhong Jijia Precision Co., Ltd. 64,945,137.36 42,691,953.22
Sichuan Changhong Mould Plastic Technology Co.,
108,604,718.19 44,617,994.79
Ltd.
Sichuan Changhong Minsheng Logistics Limited
14,343,724.63 9,403,109.53
Company
Sichuan Changhong Packing Printing Co., Ltd. 1,717,613.38 7,080,395.30
Sichuan Changhong Equipment Science &
11,096,159.81 5,472,068.07
Technology Co., Ltd.
Mianyang Hongrun Electrical Co., Ltd. 2,833,102.80 -
Sichuan Changhong Precise Electrical Science &
1,439,206.93 651,172.51
Technology Co., Ltd.
Sichuan Changhong New Energy Science &
422,531.58 359,419.72
Technology Co., Ltd.
Guangdong Changhong Electrical Co., Ltd. 98,536.02 26,848.37
188
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Sichuan Hongxin Software Co., Ltd. - 36,000.00
Sichuan Changhong Power Supply Limited 57,890.44 29,057.54
Jindezhen Honghua Appliance Components Co., Ltd. 791,846.42 -
Sichuan Changhong Gerun Renewal Resources Co.,
10,503.63 -
Ltd.
Sichuan Service Exp. Appliance Service Chain Co.,
97,926.00 6,756,125.52
Ltd.
Sichuan Changhong International Hotel Co., Ltd. 37,749.00 -
Sichuan Jiahong Industrial Co., Ltd. 31,428.00 -
081 Electric Group Sichuan Liyuan Electronic Co.,
1,297,721.69 582,427.29
Ltd
Zhongshan Changhong Mould Plastic Science &
86,378.69 28256.13
Technology Co., Ltd.
Associates of controlling shareholders and actual
controllers:
Including: Sichuan Changhong Dongyuan Precise Equipment
2,600,402.86 160,743.88
Co., Ltd.
Sichuan Changxin Refrigeration Parts Co., Ltd. 16,406,281.37 2,802,151.03
Sichuan Jinghong Packing Product Co.,Ltd. 5,736,126.97 347,443.03
Sichuan Hongyu Metal Manufacture Co., ltd. 89,486.18 -
Sichuan Changhe Technology Co., Ltd. 724,829.01 422,644.13
Sichuan Huafeng Enterprise Group Co., Ltd. 8,787,320.90 -
Total 391,251,813.52 283,110,120.81
4. Other account payable of related parties
Amount at
relate parties (item) Amount at period-end
year-begin
Controlling shareholder and terminal controller -
Including: Sichuan Changhong Electric Co., Ltd. 13,508,583.05 5,138,393.96
Sichuan Changhong Electric Group Co., Ltd. 10,539.73 -
Other enterprises under control from the same controlling
reholder y or terminal controller -
Including: Sichuan Changhong Minsheng Logistics Limited
15,317,506.06 32,347,821.57
mpany
Sichuan Changhong Jijia Precision Co., Ltd. 7,200,000.00 200,000.00
Sichuan Changhong Mould Plastic Technology Co.,
320,000.00 320,000.00
Sichuan Changhong Property Co., Ltd. - 3,042.00
Jindezhen Honghua Appliance Components Co., Ltd. 50,000.00 50,000.00
Sichuan Changhong Gerun Renewable Resources Co.,
10,000.00 27,523.40
Sichuan Service Exp. Appliance Service Chain Co.,
4,167,200.00 -
189
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Sichuan Changhong International Hotel Co., Ltd 2,168.00 2,168.00
Sichuan Jiahong Industrial Co., Ltd. 10,000.00 -
081 Electric Group Sichuan Liyuan Electronic Co., Ltd 2,000.00 -
Associates of controlling shareholders and actual
trollers:
Including: Sichuan Changhong Dongyuan Precise Equipment
346,610.86 -
Ltd.
Sichuan Changhe Technology Co., Ltd. 66,010.55 50,000.00
Total 41,010,618.25 38,138,948.93
X. Contingency
(I) Pending action or possible liabilities formed from arbitration: Nil
(II)Contingencyfromexternalguarantee:Nil
(III) Besides the above contingencies, the Company had no other major contingencies till end of
30 June 2012.
XI.Commitments
(I)OnMarch25, 2010, inthe“EquityTransferringContract”enteredintobetween theCompany
andXingtaiHoldingCompany,theCompanymakescommitmentas:
(1)Don’tchangethedominantlegalpersonpositionofthetransfereecorporation,thenewunit
aftertransferringcouldn’tmoveoutofHefeiCityforcontinuouselectronicapplianceandrelated
industries. New units after transferring must contribute tax more than 15 million yuan per year
within5yearswhichequaltotheactualtaxcontributedbypreviousMeilingGroupinlastyear.
(2)Within5yearssincethecontractcomesintoeffecttheCompanymustnewlyincreaseover0.1
billionyuanofinvestmentinHefeicity.
(3)Within5yearssincethecontractcomesintoeffecttheCompanycouldn’ttransferexternally
thistransfereebesidesinternaltransferring.
(4) The total amount of 48.69 million yuan of creditor’s rights owned by subsidiary within the
transferring scope of previous Meiling Group (the actual amount of creditor’s right should be
determined according to audit report issued in deadline of audit Mar. 25, 2010 ), have been
transferredtoHefeiXingtaiAssetManagementCo.,Ltd.Thenewunitaftertransferringshouldpay
off the debts within 2 years since the contract was signed (must supply lawful and effective
guarantee).
(5)Thenewunitaftertransferringoffersjobsaccordingto80%ofthepresentnumberofworking
staffs of the transferee corporation and subsidiaries within transferring scope. Under the same
condition,presentstaffsofthecorporationwouldbegiven preferencewhenemploying,present
managementpersonnelwouldbeorderlyplaced.Takethereplacementdateofidentityofstaffsas
the successive date of labour relationship. Sign contracts with allotted time of over 3 years with
employedpersonwithin1monthsincethecontractcomesintoeffect;successivelyornewlyoffer
varioussocialinsurancesforstaffsaccordingtorelevantrulesandcontributehousingaccumulation
fund.
(6) The new unit after transferring takes over all the assets and liabilities which have been
estimatedandapprovedofthetransfereecorporation.
(7) The new unit after transferring implements terms signed externally of the transferee
corporation.
(8) The new unit after transferring continuously matches party A to complete the stripping
190
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
operationofnon‐transferredinterestsandrightsbelongingtothetransfereecorporation.
(9)Thenewunitaftertransferringmustrationallymakeuseofthelandwithintransferringcouldn’t
callforchangingtheusageoflands.
(10) The new unit after transferring couldn’t weaken or dim the trademark and trade name of
Meiling inversely should carefully protect the trademark and trade name of Meiling and make
commitment that output of Meiling products can’t be lower than 70% of production of Meiling
products;thegrowthrateofsalesofMeilingproductscan’tbelowerthan20%eachyear;R&Dand
trademarkmaintenancefeesofMeilingproductscan’tbelessthan1%ofsalesamount.
(II) On 27 February 2011, “Deposit Agreement of Quality Service- First Compensation for Meiling
Refrigerator Consumer Rights Protections” was signed between the Company and China
Consumers’ Association. The Company volunteers to set up a deposit of RMB 5 million for
“Quality Service- First Compensation for Meiling Refrigerator, Consumer Rights Protections” in
CCA, and CCA in charge of the deposit. Concerning unsatisifaction for treatment from the
Company, on refrigerator products or service the Company provided, compensate consumers, who
claims to CCA after mediation. Till end of 1 March 2012, the above said deposit has no
compensated yet. The agreement has one year validity period. No agreement renewable between the
two parties so far.
Besidestheaboveevents,theCompanyhadnoothersignificantcommitmenttillendof30June
2012.
XII. Events occurring after the balance sheet date
(I)Significantlawsuits,arbitrationsandcommitmentsmadeafterbalancesheetdate:Nil
(II)Significantchangesonassetsvalue,taxpolicyandforeignexchangerateafterbalancesheet
date:Nil
(III) Significant losses on assets due to nature disaster after balance sheet date: Nil
(IV) Shares and bonds issuance and other significant debt financing after balance sheet date: Nil
(V) Share capital transfer from public reserve fund after balance sheet date: Nil
(VI) Significant deficit occurred after balance sheet date: Nil
(VII) Enterprise merge or subsidiary disposal occurred after balance sheet date: Nil
(VIII) Significant external investment after balance sheet date: Nil
(IX) Dividend or profit plans to distribute or declare to distribute approved by discussion in the
plan of profit distribution: Nil
(X) Other than the above mentioned events, the Company have no other events occurred after
balance sheet date.
XIII. Segment information (Unit: RMB0’000)
(I) Segment of Semi-Annual report of 2012
Offset
Refrigerator Air-condi Washing Marketin
Items Other between Total
and freezer tioner machine g
segments
152,786.7 277,870.2 531,720.3
Operation income 341,614.72 1,325.64 12,190.24 254,067.21
4 1 4
Including: income from 152,506.4 277,870.2 531,720.3
95,869.86 391.63 5,082.22 -
external transaction 2 1 4
Income from
transaction between 245,744.86 280.31 934.01 - 7,108.02 254,067.20 -
segments
191
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Offset
Refrigerator Air-condi Washing Marketin
Items Other between Total
and freezer tioner machine g
segments
148,778.8 280,347.3 517,737.4
Operation expense 326,474.36 1,580.22 13,159.52 252,602.85
1 8 4
Operation profit(loss) 15,140.36 4,007.92 -254.58 -2,477.17 -969.29 - 13,982.89
173,697.7 102,681.6 829,975.8
Total assets 730,121.88 3,994.22 26,928.26 207,447.90
5 8 9
128,116.9 103,933.3 543,753.6
Total liabilities 405,132.17 7,322.64 16,720.76 117,472.26
5 8 4
Supplementary information - - - - - - -
Depreciation and
5,642.34 847.68 141.46 3.67 954.28 12.60 7,576.83
amortization expense
Capital expenditure 12,076.36 781.01 1.35 - 54.83 - 12,913.55
Non-cash expense except
for depreciation and 16,757.34 13,553.39 37.06 16,943.65 434.10 - 47,725.54
amortization
XIV. Other significant matters
(I) Operation of leased-out assets
Type of assets leased out Amount at period-end Amount at year-begin
Houses and buildings( investment real estate) 16,279,699.03 16,664,805.83
Machinery equipment(fixed assets leased temporary) 99,582.31 16,733,497.12
Other equipment (fixed assets leased temporary) 531,278.70 37,905.00
Land use right( investment real estate) 634,551.85 653,736.13
Total 17,545,111.89 34,089,944.08
(II) Assets and liabilities measured by fair value: Nil
(III) Financial assets and liabilities with foreign currency
Gains and losses of accumulative fair Impairment
Amount at Amount at
Item fair value change value change withdrew this
year-begin year-end
of this year recorded in equity year
Financial assets
Financial assets measured by fair
value and whose change is recorded
in current gains and losses - - - - -
(excluding derivative financial
assets)
Derivative financial assets - - - - -
Loans and account receivable 19,893,918.11 1,670,279.87 33,405,597.44
Financial assets available for sale - - - - -
Hold-to-maturity investment - - - - -
Subtotal of financial assets 19,893,918.11 1,670,279.87 33,405,597.44
Financial liabilities
Foreign currency loans - - - - 17,147,698.33
Subtotal of financial liabilities - - - - 17,147,698.33
192
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
XV. Notes to main items of financial statement of parent company
1. Account receivable
(1) Age structure of account receivable
Amount at period-end Amount at year-begin
Book balance Bad debt provision Book balance Bad debt provision
Item
Ratio Ratio Ratio Ratio
Amount Amount Amount Amount
(%) (%) (%) (%)
Within 1year 809,761,538.21 98.95 10,608,231.56 64.78 410,913,726.29 97.33 14,268,314.42 71.50
1-2years 1,684,245.88 0.21 252,636.88 1.54 4,967,556.79 1.18 745,133.52 3.73
2-3 years 1,953,624.30 0.24 683,768.51 4.18 1,483,269.40 0.35 519,144.29 2.60
3-4 years 1,229,541.01 0.15 1,171,284.86 7.15 1,708,099.57 0.40 1,708,099.57 8.56
4-5 years 738,385.81 0.09 738,188.11 4.51 3,107,988.41 0.74 2,709,459.92 13.59
Over 5 years 2,921,974.66 0.36 2,921,974.66 17.84 4,311.68 0.00 4,311.68 0.02
Total 818,289,309.87 100.00 16,376,084.58 100.00 422,184,952.14 100.00 19,954,463.40 100.00
Net value 801,913,225.29 402,230,488.74
(2) Risk structure of account receivable
Amount at period-end Amount at year-begin
Book balance Bad debt provision Book balance Bad debt provision
Item
Ratio Ratio Ratio Ratio
Amount Amount Amount Amount
(%) (%) (%) (%)
Account receivable with single
significant amount and
- - - - - - - -
withdrawal single item bad
debt provision
Account receivable withdrawal bad debt provision by combination
combination 1 218,627,238.57 26.72 14,310,920.26 87.39 294,478,282.88 69.75 17,795,231.99 6.04
combination 2 597,596,906.98 73.03 - - 125,547,437.85 29.74 - -
Subtotal 816,224,145.55 99.75 14,310,920.26 87.39 420,025,720.73 99.49 17,795,231.99 4.24
Account receivable with single
minor amount but withdrawal 2,065,164.32 0.25 2,065,164.32 12.61 2,159,231.41 0.51 2,159,231.41 100.00
single item bad debt provision
Total 818,289,309.87 100.00 16,376,084.58 2.00 422,184,952.14 100.00 19,954,463.40 4.73
Net value 801,913,225.29 402,230,488.74
(3) Account receivable with single significant amount and withdrawal bad debt provision single: Nil
(4) Among the combinations 1, withdwral bad debt provision by account age:
Amount at period-end Amount at year-begin
Age Bad debt Bad debt
Amount Ratio (%) Amount Ratio (%)
provision provision
Within 1 year 212,164,631.23 5 10,608,231.56 285,366,288.44 5 14,268,314.42
1-2 years 1,684,245.88 15 252,636.88 4,967,556.79 15 745,133.52
2-3 years 1,953,624.30 35 683,768.51 1,483,269.40 35 519,144.29
3-4 years 129,458.11 55 71,201.96 - 55 -
4-5years 1,318.00 85 1,120.30 2,656,856.57 85 2,258,328.08
193
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at period-end Amount at year-begin
Age Bad debt Bad debt
Amount Ratio (%) Amount Ratio (%)
provision provision
over5 years 2,693,961.05 100 2,693,961.05 4,311.68 100 4,311.68
Total 218,627,238.57 14,310,920.26 294,478,282.88 17,795,231.99
Net value 204,316,318.31 276,683,050.89
(5) Vary account in combination 2:
Accrued Bad debt
Items Book balance
proportion provision
Current account with related parties 535,857,446.98 0% -
Account receivable with L/C 61,739,460.00 0% -
Total 597,596,906.98 -
(6) Account receivable with single minor amount but withdrawal single item bad debt provision at period-end
Bad debt Accrued Accrued
Account receivable Book balance
provision proportion reasons
Shandong Wendeng Department Store General
129,051.14 129,051.14 100%
Company
Jiangsu Zhenjiang Gome Electrical
176,425.61 176,425.61 100% Cease
Appliances Co., Ltd.
business
Liuzhou Minyu Hardware Appliance Business 51,588.00 51,588.00 100% contact 3-5
Nanjing Central Emporium Co., Ltd. 512,925.85 512,925.85 100% years;
Zhejiang Yongle Appliance Co., Ltd. predicted
95,090.82 95,090.82 100%
(Taizhou) un-recovere
Gaomi Sanhe Appliance Market Co., Ltd. 610,458.57 610,458.57 100% d for urgent
Cifeng Baixin Apparatus Co., Ltd. 271,114.97 271,114.97 100%
Yichun Jixing Appliance Town 218,509.36 218,509.36 100%
Total 2,065,164.32 2,065,164.32
(7) Account receivable received of previous that being verified in 2011: Nil
(8) Bad debt provision switch-back: Nil
(9) Bad debt of account receivable verified in this year: Nil
(10) Arrears of the shareholders holding more than 5% (including 5%) shares with voting rights of
the Company
Amount at period-end Amount at year-begin
Unit Bad debt Bad debt
Arrears Arrears
provision provision
Sichuan Changhong Electric
25,257.14 - 25,257.14 -
Co., Ltd.
(11)Top5ofaccountreceivable
194
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Proportion
Relationship
in total
Unit with the Amount Age
account
Company
receivable
Hefei Meiling Appliance Marketing Within 1
Subsidiary 494,525,984.80 60.43%
Co., Ltd. year
Non-related Within 1
Electrolux (China) Electric Co., Ltd. 87,534,851.53 10.70%
party’s client year
Electrolux Major Appliances, Latin Non-related Within 1
27,663,858.59 3.38%
Ameri party’s client year
Under same Within 1
changhong Electric(Australia) 19,014,763.12 2.32%
control year
Guangxi Meiling Household Affiliated Within 1
17,491,557.60 2.14%
Appliance Co., Ltd. enterprise year
Total 646,231,015.64 78.97%
(12) Account receivable of related parties
Relationship with Proportion in total account
Unit Amount
the Company receivable
Mianyang Lejiayi Trading Chain Co.,Ltd. Under same control 22,077.66 0.003%
Hefei Meiling Appliance Marketing Co.,
Subsidiary 494,525,984.80 60.43%
Ltd.
Zhongke Meiling Cryogenics Technology
Subsidiary 4,059,561.62 0.50%
Limited Company
Hefei Meisidun Appliance Co., Ltd. Subsidiary 667,014.04 0.08%
Sichuan Changhong Electric Co., Ltd. Subsidiary 25,257.14 0.003%
Jiangxi Meiling Refrigeration Co., Ltd. Subsidiary 19,000.00 0.002%
changhong Electric(Australia) Under same control 19,014,763.12 2.32%
Joint-venture,
Guangxi Meiling Household Appliance Co.,
affiliated enterprise 17,491,557.6 2.14%
Ltd.
of subsidiary
Total 535,825,215.98 65.48%
(13) Balance of accounts receivable in foreign currencies
Amount at period-end Amount at year-begin
Foreign
currency Original Exchange Original Exchange
RMB converted RMB converted
currency rate currency rate
USD 30,073,489.49 6.3249 190,211,813.68 11,821,292.86 6.3009 74,484,784.18
EUR 371,379.60 7.8710 2,923,128.83 80,368.91 8.1625 656,011.23
AUD 2,859,772.62 6.3474 18,152,120.73 1,449,875.21 6.4093 9,292,685.18
Total 211,287,063.24 84,433,480.59
2. Other account receivable
(1) Age structure of other account receivable
195
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at period-end Amount at year-begin
Book balance Bad debt provision Book balance Bad debt provision
Item
Ratio Ratio Ratio Ratio
Amount Amount Amount Amount
(%) (%) (%) (%)
Within 1 year 45,256,022.18 93.11 70,735.60 2.80 47,589,941.38 92.88 354,284.00 12.97
1-2years 209,309.78 0.43 - - 934,623.97 1.82 30,000.00 1.10
2-3 years 475,104.76 0.98 70,000.00 2.77 257,209.36 0.50 70,435.31 2.58
3-4 years 376,692.00 0.78 110,684.06 4.38 182,820.37 0.36 - -
4-5 years 13,757.25 0.03 - - - - - -
over5 years 2,274,133.93 4.68 2,274,133.93 90.04 2,276,133.93 4.44 2,276,133.93 83.35
Total 48,605,019.90 100.00 2,525,553.59 100.00 51,240,729.01 100.00 2,730,853.24 100.00
Net value 46,079,466.31 48,509,875.77
(2) Risk structure of other account receivable:
Amount at period-end Amount at year-begin
Book balance Bad debt provision Book balance Bad debt provision
Item
Ratio Ratio Ratio Ratio
Amount Amount Amount Amount
(%) (%) (%) (%)
Account receivable with
single significant amount and
- - - - - - - -
withdrawal single item bad
debt provision
Account receivable withdrawal bad debt provision by combination
combination 1 1,913,095.96 3.94 348,559.87 18.22 7,584,063.96 14.80 551,859.52 7.28
combination 2 44,514,930.22 91.59 - - 41,477,671.33 80.95 - -
Combination Subtotal 46,428,026.18 95.52 348,559.87 0.75 49,061,735.29 95.75 551,859.52 1.12
Account receivable with
single minor amount but
2,176,993.72 4.48 2,176,993.72 100.00 2,178,993.72 4.25 2,178,993.72 100.00
withdrawal single item bad
debt provision
Total 48,605,019.90 100.00 2,525,553.59 5.20 51,240,729.01 100.00 2,730,853.24 5.33
Net value 46,079,466.31 48,509,875.77
(3) Other account receivable with single significant amount and withdrawal bad debt provision single: Nil
(4) Among combinations 1, withdrwal bad debt provision by age analysis:
Amount at period-end Amount at year-begin
Age Bad debt Bad debt
Amount Ratio (%) Amount Ratio (%)
provision provision
Within 1 year 1,414,712.00 5 70,735.60 7,085,680.00 5 354,284.00
1-2 years - 15 - 200,000.00 15 30,000.00
2-3 years 200,000.00 35 70,000.00 201,243.75 35 70,435.31
3-4 years 201,243.75 55 110,684.06 - 55 -
4-5 years - 85 - - 85 -
196
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount at period-end Amount at year-begin
Age Bad debt Bad debt
Amount Ratio (%) Amount Ratio (%)
provision provision
Over 5 years 97,140.21 100 97,140.21 97,140.21 100 97,140.21
Total 1,913,095.96 348,559.87 7,584,063.96 551,859.52
Net value 1,564,536.09 7,032,204.44
(5) Vary account in combination 2:
Accrual Bad debt
Combination Book balance Age
proportion provision
Connected amount between related
41,954,245.12 0% - Within 1 year
parties
Reserve fund of employees 2,560,685.10 0% - Within 1 year
Total 44,514,930.22
(6) Other account receivable with single minor amount but withdrawal single item bad debt provision at
period-end
Other account Bad debt Accrual
Book balance Reasons
receivable provision proportion
Resignation workers 2,176,993.72 2,176,993.72 100% Un-receivable
(7)Other account receivable of previous years that have been verified recovered in 2012: Nil
(8) Switch-back of bad debt provision: Nil
(9) Other account receivable verified in this year: Nil
(10) In the balance of other receivable at the end of this year, there is no arrearage due from
shareholders holding 5% or above voting right shares of the Company
(11) Particulars about the top 5 others receivable
Proportion
taking in
Unit Amount Ageing total Nature or content
accounts
receivable
Hefei Meiling Appliance Marketing
37,437,949.39 1-2 years 77.02% Connected amount
Co., Ltd.
Sichuan Changhong Air-Conditioner Within 1
2,943,819.31 6.06% Connected amount
Co., Ltd. year
Social Security bureau of Hefei
Within 1 Margin for civilian
City(gurantee fund for migrant 1,414,712.00 2.91%
year workers
workers)
Luohe Meiling Appliance Marketing Within 1
1,350,000.00 2.78% Connected amount
Co., Ltd. year
197
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Proportion
taking in
Unit Amount Ageing total Nature or content
accounts
receivable
Deposit of home
CEIEC(Deposit of home appliance
492,000.00 1-2 years 1.01% appliance going to
going to the countryside)
the countryside
Total 43,638,480.70 89.78%
(12) Other account receivable from related parties
Item Amount at period-end Amount at year-begin
Hefei Meiling Appliance Marketing Co., Ltd. 37,437,949.39 37365819.17
Guangyuan Meiling Appliance Marketing Co., Ltd. 0.20 0.20
Changzhou Meiling Appliance Marketing Co., Ltd. 6,468.80 6468.80
Guangxi Meiling Appliance Marketing Co., Ltd. 2,753.04 -
Xinxiang Meiling Appliance Marketing Co., Ltd. 96,000.00 96,000.00
Xuancheng Meiling Appliance Marketing Co., Ltd. - -
Liu’an Meiling Appliance Marketing Co., Ltd. 6,400.00 -
Jinzhou Meiling Appliance Marketing Co., Ltd. 4,803.50 4,803.50
Luohe Meiling Appliance Marketing Co., Ltd. 1,350,000.00 -
Changchun Meiling Appliance Marketing Co., Ltd. 58,650.88 -
Sichuan Changhong Air-Conditioner Co., Ltd. 2,943,819.31 -
Hefei Meiling Non-ferrous Metal Co., Ltd. 47,400.00 -
Zhongke Meiling Cryogenics Technology Limited
- 92,223.85
Company
Urumchi Meiling Appliance Marketing Co., Ltd. - 12,893.47
Neijiang Meiling Appliance Marketing Co., Ltd. - 59,504.43
Total 41,954,245.12 37,637,713.42
(13) Account receivable denominated in foreign currency: Nil
3. Long-term equity investments
(1)Classification of long-term equity investments
Amount at
Item Amount at period-end
year-begin
Long-term equity investment calculated by
829,348,087.68 829,348,087.68
cost method
Long-term equity investment calculated by
12,250,094.32 12,074,296.65
equity method
Total of long-term equity investment 841,598,182.00 841,422,384.33
Less: provision for impairment of long-term
- -
equity investment
198
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Value of long-term equity investment 841,598,182.00 841,422,384.33
(2)Long-term equity investments calculated by cost method and equity method
Shareh Voting
Increase Decrease Cash
olding right Initial Amount at Amount at
Invested unit during the during the dividend for
ratio ratio amount year-begin period-end
year year this year
(%) (%)
Calculation by
cost method
Zhongke
Meiling
Cryogenics 70.00 70.00 42,000,000.00 42,000,000.00 - - 42,000,000.00 -
Limited
Company
Jiangxi Meiling
Refrigeration 90.00 100.00 45,000,000.00 45,000,000.00 - - 45,000,000.00 -
Co., Ltd.
Mianyang
Meiling
90.00 100.00 45,000,000.00 95,000,000.00 - - 95,000,000.00 -
Refrigeration
Co., Ltd.
Hefei Meiling
Appliance
99.00 100.00 9,900,000.00 54,900,000.00 - - 54,900,000.00 -
Marketing Co.,
Ltd.
Sichuan
Changhong Air
100.00 100.00 305,600,437.79 305,600,437.79 - - 305,600,437.79 -
Conditioner Co.,
Ltd.
Zhongshan
Changhong
90.00 90.00 76,256,419.37 76,256,419.37 - - 76,256,419.37 -
Appliance Co.,
Ltd.
Huishang Bank
0.13 0.13 5,000,000.00 5,000,000.00 - - 5,000,000.00 1,073,757.30
Co., Ltd.
Hefei Meiling
Packing
48.28 100.00 25,055,600.00 12,961,230.52 - - 12,961,230.52 -
Products Co.,
Ltd.
Hefei Meiling
Group Holding 100.00 100.00 113,630,000.00 113,630,000.00 - - 113,630,000.00 -
Co., Ltd.
Jiangxi Meiling
Appliance Co., 98.75 100.00 79,000,000.00 79,000,000.00 - - 79,000,000.00 -
Ld.
Subtotal 746,442,457.16 829,348,087.68 - - 829,348,087.68 1,073,757.30
Calculation by
equity method
Hefei Xingmei
Assets
48.28 48.28 12,094,369.48 12,074,296.65 175,797.67 - 12,250,094.32 -
Management
Co., Ltd.
Subtotal 12,094,369.48 12,074,296.65 175,797.67 - 12,250,094.32 -
Total 758,536,826.64 841,422,384.33 175,797.67 - 841,598,182.00 1,073,757.30
(3)Investment in associates
Total assts Total Total operating Net profit
Total net assets
Invested unit at liability at income this of this
at period-end
period-end periodend year year
199
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Hefei Xingmei Assets
29,462,169.71 1,923,899.60 27,538,270.11 1,513,552.20 364,121.10
Management Co., Ltd.
4. Operation income and operation cost
(1)Operation income and operation cost
Same period of last
Item Amount for this year
year
Main business income 3,231,307,780.05 3,604,607,979.80
Other business income 389,731,362.59 601,876,011.12
Total 3,621,039,142.64 4,206,483,990.92
Main business income 2,689,101,247.09 2,716,145,527.69
Other business income 380,915,606.24 588,185,835.37
Total 3,070,016,853.33 3,304,331,363.06
(2)Classifiedaccordingtoproduct
Amount for this year Same period of last year
Industry
Operation income Operation cost Operation income Operation cost
Main business 3,231,307,780.05 2,689,101,247.09 3,604,607,979.80 2,716,145,527.69
Refrigerator
3,170,841,768.18 2,637,049,040.26 3,554,806,111.78 2,675,279,505.96
and freezer
Washing machine 59,699,998.53 50,861,363.20 49,801,868.02 40,866,021.73
Other 766,013.34 1,190,843.63 - -
Other business 389,731,362.59 380,915,606.24 601,876,011.12 588,185,835.37
Total 3,621,039,142.64 3,070,016,853.33 4,206,483,990.92 3,304,331,363.06
(3)Classified according to region
Amount for this year Same period of last year
Region
Operation income Operation cost Operation income Operation cost
Domestic sales
3,190,412,833.84 2,642,377,624.08 3,913,732,488.43 3,023,483,357.12
income
Overseas sales
430,626,308.80 427,639,229.25 292,751,502.49 280,848,005.94
income
Total 3,621,039,142.64 3,070,016,853.33 4,206,483,990.92 3,304,331,363.06
(4)Sales income from the top 5 customers for this year
Proportion taking in
Customer Operating income total operating income
of the Company (%)
Shijiazhuang Meiling Apparatus Marketing Co.,
148,843,343.94 4.11%
Ltd.
Mianyang Meiling Apparatus Marketing Co., Ltd. 120,930,613.80 3.34%
Hefei Meiling White Appliance Marketing
116,278,501.33 3.21%
Co.,Ltd.
Taiyuan Meiling Apparatus Marketing Co., Ltd. 105,693,310.94 2.92%
Beijing Meiling Apparatus Marketing Co., Ltd. 103,662,113.99 2.86%
200
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Proportion taking in
Customer Operating income total operating income
of the Company (%)
Total 595,407,884.01 16.44%
5. Investment income
(1) Sources of investment income
Amount for this Same period of last
Item
year year
Long-term equity investment income by cost method 1,073,757.30 -
Long-term equity investment income by equity method 175,797.67 -37,579.41
Investment income from disposal of long-term equity
- 201,850.28
investment
Investment income from period of holding financial
- -
assets available for sale
Investment income from disposal of financial assets
- -
available for sale
Accrued income from disposal of subsidiaries from cost
- -
method to equity method
Total 1,249,554.97 164,270.87
(2) Long-term equity investment income by equity method
Amount for this Same period of Reasons for
Item
year last year increase/decrease
Hefei Xingmei Assets Management Co.,
175,797.67 -37,579.41
Ltd.
Total 175,797.67 -37,579.41
6. Supplementary information for cash flow statement of parent company
Amount for this Same period of
Item
year last year
1. Adjust net profit to cash flow for operational activities:
Net profit 110,870,938.47 126,786,138.15
Add: provision for depreciation of assets -24,334,130.41 12,483,061.95
Depreciation of fixed assets, consumption of oil gas assets and
34,970,754.18 36,905,963.72
depreciation of productive biological assets
Amortization of intangible assets 12,245,773.41 12,245,773.41
Amortization of long-term retained expense - -
Loss from disposal of fixed assets, intangible assets and other
-81.64 1,876,439.38
long term assets (gain is listed with “-”)
Loss from discarding fixed assets as useless (gain is listed with
5,279,309.14 -
“-”)
Loss from change of fair value(gain is listed with “-”) - -
Financial expense (gain is listed with “-”) -6,305,853.31 -18,725,111.31
Investment loss (gain is listed with “-”) -1,249,554.97 -164,270.87
201
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount for this Same period of
Item
year last year
Decrease of deferred income tax assets (increase is listed with
-795,809.16 -18,988,030.67
“-”)
Increase of deferred income tax liabilities (decrease is listed
- -
with “-”)
Decrease of inventories (increase is listed with “-”) 498,749,442.14 -26,384,122.87
Decrease of operational accounts receivable (increase is listed
-1,193,687,338.13 -895,455,379.10
with “-”)
Increase of operational accounts payable (decrease is listed
250,140,718.90 270,530,983.97
with “-”)
Others - -
Net cash flow arising from operation activities -314,115,831.38 -498,888,554.24
2. Significant investment and financing activities with no
reference to cash collection and payment:
Debt convert to capital - -
Convertible bond due within one year - -
Fixed assets leased in by financing - -
3. Net change in cash and cash equivalent:
Balance of cash at period-end 789,679,272.06 1,062,368,214.04
Less: Balance of cash at period-begin 1,045,235,918.61 1,798,742,365.27
Add: Balance of cash equivalent at period-end - -
Less: Balance of cash equivalent at period-begin - -
Net increase in cash and cash equivalent -255,556,646.55 -736,374,151.23
XVI. Supplementary information
(I) Non-operational gains and losses for this year
Non-recurring gains and losses regulated by Explanation Announcement of Information Disclosure
on Stock Issuance Enterprise No.1—Non-recurring gains/losses (2008) from CSRC:
Amount for Same period
Item Explanation
this year of last year
Refer to
Non-operatin
Gains and losses from disposal of non-current assets -5,181,933.89 9,089,799.67 g gains and
Expenditure
for details
Tax refund or mitigate due to examination-and-approval
beyond power or without official approval document or - -
accident
Refer to
Non-operatin
Government subsidy recorded in current gains and losses 4,237,836.91 3,133,103.85
g Income for
details
Capital occupancy expense, collected from non-financial
- -
enterprises and recorded in current gains and losses
Income from the exceeding part between investment cost
of the Company paid for obtaining subsidiaries, associates
- -
and joint-ventures and recognizable net assets fair value
attributable to the Company when acquiring the investment
Gains and losses from exchange of non-monetary assets - -
202
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
Amount for Same period
Item Explanation
this year of last year
Gains and losses from assets under trusted investment or
- -
management
Various provision for impairment of assets withdrew due to
- -
act of God, such as natural disaster
Gains and losses from debt restructuring - -
Enterprise reorganization expense - -
Gains and losses of the part arising from transaction in
- -
which price is not fair and exceeding fair value
Current net gains and losses occurred from period-begin
to combination day by subsidiaries resulting from - -
business combination under common control
Gains and losses arising from contingent proceedings
- -
irrelevant to normal operation of the Company
Except for effective hedge business relevant to normal
operation of the Company, gains and losses arising from
fair value change of tradable financial assets and tradable
- -
financial liabilities, and investment income from disposal
of tradable financial assets, tradable financial liabilities and
financial assets available for sale
Switch-back of provision of impairment of account
- -
receivable which are treated with separate depreciation test
Gains and losses obtained from external trusted loans - -
Gains and losses arising from change of fair value of
investment real estate whose follow-up measurement are - -
conducted according to fair value pattern
Affect on current gains and losses after an one-time
adjustment according to requirements of laws and - -
regulations regarding to taxation and accounting
Trust fee obtained from trust operation - -
Refer to
Non-operatin
Other non-operating income and expenditure except for the
-102,072.38 61,872.32 g gains and
aforementioned ones
Expenditure
for details
Other gains and losses items complying with definition for
- -
non-current gains and losses
12,284,775.8
Subtotal -1,046,169.36
4
Affect on income tax 38,231.24 1,903,048.71
Affect on minority equity(after taxation) -302,656.89 78,593.96
10,303,133.1
Total -781,743.71
7
(II) Return on equity and earnings per share
In accordance with requirement of the No. 9 Rule of Information Disclosure Compiling of Public
Listed Companies: Calculation and Disclosure of Return on Equity and Earnings per Share (revised
in 2010), the weighted average return on equity, basic earnings per share and diluted earnings per
share of the Company in first half year of 2012 are as follow:
Profit during the report period Weighted average Earnings per share
203
AnnotationstoFinancialStatementsofHefeiMeilingCo.,Ltd.
From1January2012to30June2012
(Unlessotherwisespecified.RMBforrecordinthestatement)
return on equity (%) Basic Diluted
earnings per earnings per
share share
Net profit attributable to shareholders of parent
3.89% 0.1742 0.1742
company
Net profit attributable to shareholders of parent
company after deduction of non-recurring 3.91% 0.1754 0.1754
gains and losses
XVII. Approval of financial statement
The financial statement has already been approved from the board of directors of the Company for
reporting dated 16 August 2012.
204
Hefei Meiling Co., Ltd. Semi-Annual Report 2012
Chapter IX. Documents Available for Reference
Documents Available for Reference
I. Text of semi-annual report with signature of the President;
II. The financial report carrying the signatures and seals of the President, person who in charge of
financial works and Principal of Accounting Institutes;
III. Originals documents of the Company and manuscripts of public notices that disclosed in the
newspapers designated by CSRC in the report period;
IV. “Article of Association of Hefei Meiling Co., Ltd.”
The aforesaid documents are all available at the Company. The Company would provide them
timely when CSRC and Shenzhen Stock Exchange require or the shareholders need consultation
according to the regulations and Articles of Association.
Hefei Meiling Co., Ltd.
Chairman: Liu Tibin
Approval date by the Board: 16 August 2012
205
